What is a Pawn Loan? Here’s How It Compares to the Alternatives

Where can I borrow money? It’s a question many of us ask ourselves at some point in our lives. Perhaps it’s a big milestone, like buying a house or a car, starting a business, or planning to grow your family. Then again, maybe you simply need a little cash to pay a bill or make rent. For cases when you need a large amount of money – like when you’re buying a house or a car – you can get a loan from banks. For others – say, if you need several hundreds of dollars – you can take out a pawn loan.

There’s a little mystery surrounding pawn loans because they’re different from other methods of borrowing small amounts of money, which include:

  • credit card cash advances.
  • payday loans.
  • car title loans.

It also doesn’t help that there are a lot of misconceptions about pawn loans in general. When you’re strapped for cash and need money now, comparing your options can feel daunting. Let’s break it down.

Credit Card Cash Advances

A credit card cash advance is a short-term loan. The cash is borrowed against your credit limit. This is a quick and easy option if:

  1. you have a credit card.
  2. your card has sufficient available credits.

If you don’t have a credit card yet, you will have to complete an application form first and submit the necessary requirements – like sources of income – to the credit card company. They will have to conduct a credit check before they give approval and send you your own card.

While it might be an option, obtaining a credit card cash advance has a few drawbacks.

  • The process can be time-consuming.
  • You’re not guaranteed any money.
  • Late payments can hurt your credit rating, and the fees are costly.

Payday Loans

Generally speaking, payday loans are short-term loans with high interest, usually due on your next payday. How high, you’re wondering? Typically, it ranges from 15% to 30%. One pro is payday loans typically don’t require a credit check, but beyond that, there is much concern. The drawbacks here are clear:

  • You have very little time to pay them off – the terms are difficult to meet.
  • Interest tends to be higher.
  • The lender won’t take into consideration your other financial obligations.
  • The lender has multiple legal options they can take against you should you not pay them back.

Car Title Loans

With a car title loan, you offer your car title as collateral. Many people believe this is a great deal because your credit score doesn’t matter. Proceed with caution! Title loans are actually banned in many states, and for good reason.

  • The monthly interest rate can be as high as 25%.
  • These loans are meant to be paid off in one lump sum, except most people can’t afford that.
  • Many of these loans end with the borrower losing their car.

Pawn Loans

At this point, you’re probably scared of taking out loans, period. Hold that thought. Pawn loans are a favorable method of borrowing money largely because they offer three things the other options don’t:

  • Your credit isn’t involved in any manner.
  • Fastest loan process. You can walk out with cash in a few minutes.
  • If you fail to pay back the loan, there will be no one chasing you down or interest payment piling up, you just forfeit the item you pawned.
  • The interest rate is lower than many alternatives if you pay it back in one month (and in our case, significantly lower).

What is a pawn loan, exactly? Let’s expand on some of the basics, discuss what you can expect, and look at how John’s Pawn Shop handles things differently from the competitors.


To Get a Loan

To get a pawn loan, you only need two things: your ID and collateral – like jewelry. The amount you can borrow will depend on the collateral you provide – not your credit rating.

Determining Value

The loan value of your item will be appraised by a professional pawnbroker. The amount will be based on the item’s current market price and its estimated resale value. We conduct careful research to ensure we give a fair and honest price for your item.

The End of the Loan

The collateral can be reclaimed once the loan has been paid off. If you’re ultimately unable to pay off the loan or simply decide you don’t want to, you can leave us the collateral instead and your credit will not take a hit.


You pay off your loan within an agreed upon period. Most pawn shops allow three months, but John’s Pawn Shop can give you a term of up to four months. If you end up needing more time to pay off the loan and reclaim your item, we can hang on to it for longer.

Interest Rate

Most commonly, pawn shops (in Las Vegas) charge an interest rate of 13% per month and offer a 3 month term. We only charge 8% – the lowest you will find in Las Vegas and give you a 4 month term. Repayment terms are far more manageable than other types of loans, and you will not get caught in a vicious cycle of debt.


We will provide you a ticket after we’ve received the collateral. The ticket is to be used when you’re paying for the loan and claiming your collateral. In the case of a lost ticket, most shops charge you a fee. Because we manage all of your information digitally, we simply look you up in our secure database, with no extra cost to you.

The Benefits of Pawn Loans

You’ve probably realized by now pawn loans offer a number of unique benefits other loans don’t.

  • They’re quick – come into our shop and get money right away.
  • You don’t need a bank account, co-signer, or credit check – only proof of identification.
  • Getting a pawn loan doesn’t have an effect on your credit, either.
  • The interest rate can’t be beaten.
  • If you cannot repay your loan, you will not be contacted by debt collectors or sued.
  • John’s offers more flexibility than other shops. We will work with you to meet your needs.

When it comes to borrowing money, it’s crucial to read the fine print. With credit card cash advances, car title loans, and payday loans, there is a lot of fine print that can land you in hot water should you not pay close enough attention. Pawn loans are significantly more transparent, with no strings attached.

Interested in getting a pawn loan? Stop by John’s Pawn Shop today, or contact us at (702) 213-3331.