Pawning is always a good option when you are in a financial crisis or even otherwise and want to make some quick money. But it may not be as simple as it seems because you must follow specific rules and regulations regarding pawning items.
Generally, stores would not accept a locked iPhone because a locked iPhone is harder to re-sell. The pawned item is collateral if the loan cannot be repaid, but if the iPhone is locked, it is less likely to be sold to a customer. Pawn shops also don’t want to trade stolen items because that is illegal, and if you cannot unlock an iPhone, that may indicate that it does not belong to you.
This is another reason why locked items are not likely to be pawned.
If you want to learn more about pawn shops and what items can and cannot be pawned, this article is for you.
What Does It Mean To Pawn An Item?
Pawning is the practice of taking any valuable item to a pawn shop and letting the pawn shop owner or the pawn broker keep that item as collateral in exchange for a loan. It is a quick and efficient way of acquiring a loan without having to go through the hassle of visiting a traditional bank.
How Do Pawn Shop Loans Work?
When you take a valuable item to the pawn shop, the pawn broker determines the object’s price. This price is determined either by the object’s market value or by its ability to be sold again. This system is known as the current appraisal system. Once the price is determined, the broker gives you the loan, a receipt, and a payback date.
The customer is expected to pay back the loan in the given number of days. If they fail to do so, the pawn broker has full ownership over the item and can legally sell it to any customer who demands it.
What Items Do Pawn Shops Loan?
You can pawn almost anything at a pawn shop provided that you can convince the pawn broker that the item is likely to be sold again or has value in the market. The most commonly sold and highly priced items that are pawned include valuable jewellery, antique collectibles, electronics, instruments, vehicles, designer clothing/ accessories and sometimes even weaponry.
But pawning weapons is harder and some pawn shops refuse to engage in the transaction.
Do Pawn Shops Have Any Rules And Regulations They Must Follow?
Pawn shops require ID cards that the customer must submit before each transaction. These ID cards help verify that the customer is of the minimum legal age to engage in the transaction. The ID cards also help the pawn shop to keep a database of the record of transactions.
These transactions are administrated and supervised by the federal government and law enforcement. Keeping the authorities in the loop is mandatory for pawn shops.
Why Do Pawn Shops Need To Keep Record Of Transactions?
Working with the authorities is legally mandated and allows to ensure safe and secure transactions. In case the pawn broker is scammed, they can use the database records that they have to work with the law enforcement and resolve the issue. Having a database allows helps keep track of stolen items because trading stole iterms are illegal to pawn.
What factors Impact The Value Of An Item At A Pawn Shop?
The value of an item is dependent on several factors. This includes the relationship that you have with the pawn broker and how much worth he sees in the investment. But also how much value an object would have when sold again. A good collateral item is one that will bring the broker good profit when sold forward. Such items are likely to get you a higher loan.
Why Is Selling A Locked iPhone Not Ideal?
Most pawn shops would refuse to accept a locked iPhone as collateral, and even if they do accept it, they might do so for a lower price than usual. This is because of two main concerns.
The iPhone May Be Stolen
Taking a locked iPhone to a pawn shop and not knowing how to unlock it or access the icloud password is an indicator of the fact that the phone may not belong to you. There’s a chance that it may have been stolen and engaging in the trade of stolen good is forbidden. It is not only forbidden it also results in loss for the broker, that is one reason why they don’t want to take the risk.
The Phone May Not Sell To Another Customer
The purpose of a collateral is that incase the loan is not paid back, it can be sold to compensate for the money that was given to the customer. A locked iphone is less likely to be sold ahead because customers usually don’t want to go through the hassle of having to get it unlocked. The process can be long and complicated and they would much rather just purchase an unlocked phone.
Another reason why locked iphones have less sellability is that the customers may suspect that they have uncleared dues. The apps may not be updated and the iCloud may not be cleared either. Again, this is alot of work and most people want to avoid the hassle.
Can You Sell A Locked iPhone?
A locked phone can be sold but the best place to sell it is probably a phone recycler company. Selling a locked phone is not a problem as long as the condition is fine but it may be hard to find customers for it and so these companies work better.
In short, technically locked phones can be pawned but you will have to really put a convincing argument before the broker. It is not something brokers would be too enthusiastic about. A locked iPhone does not have the same pawn value as an unlocked one so if you are looking to pawn your iPhone, be sure to get it unlocked first.