Overview

The 11,100 pawn shops in the US provide secured loans to individuals, using items of personal property as collateral. Firms earn interest and service fees on the loan, with interest rates charged varying by state. Pawn shops also generate revenue by selling used merchandise obtained from unpaid loans. They may also sell new and used items purchased from consumers or businesses.

Federal, State And Local Regulation

Pawn shops must comply with a number of federal regulations, as well as state and local regulations that vary widely from state to state.

Dependence On Gold Prices

A substantial portion of most pawn shops’ loans are secured by gold jewelry.