When you approach a pawnbroker you have two choices – either to leave something valuable as security for a loan, for example an asset such as jewellery or an antique, or sell the item to the pawnbroker.
- You hand over the item (known as a pawn) to the pawnbroker who will value it for you.
- The pawnbroker should give you a ‘Pre-contract Information Document’ detailing the terms of the credit agreement before the transaction takes place.
- You’ll sign a credit agreement with the pawnbroker and be given a period of time in which to pay back the loan. The maximum is seven months, but it can be less, such as 30-90 days, for example.
- The pawnbroker gives you a pawn receipt which you’ll need to keep to prove you own the item.
- When you’ve repaid the money owed you get the item back. But if you don’t repay the loan after the agreed period the pawnbroker can sell it to recover the cash.
- It is possible to extend the loan, once you have paid back the accrued interest.
- There is a 14-day cooling off period, within which you have a right to withdraw from the agreement.
How do pawnbrokers work? – what you’ll pay, and how
You can expect to pay a pawnbroker a rate of interest that is more than a high street bank loan, but often a lot less than a payday lender.
You’ll be quoted a monthly interest rate, although the pawnbroker must also show you an APR or annual percentage rate. Shop around to find the most competitive rate of interest, which can be anything from between 5-12% a month.
You are normally allowed to pay all you owe back at the end of the term, rather than in regular instalments and you should be able to pay back part or all of your loan early.
If you need more time to repay, the pawnbroker can extend the term and draw up a new credit agreement, although they can refuse. They will normally only consider letting you borrow for a longer period of time if you have at the very least paid back the interest you owe.
What you can pawn
You can pawn anything of value that can be re-sold. Jewellery is the most popular item to pawn, but people have been known to pawn anything from designer handbags to army tanks.
Pawnbrokers – the pros
- There are no credit checks so if you have a poor credit rating you can borrow.
- It’s quick – normally you will have your money the same day you sign your agreement.
- A pawnbroker should let you redeem your goods at any time and only charge interest for the period you have borrowed the money.
- It is at the pawnbroker’s risk – not the customer’s – if the valuation of the item was wrong if, once the item is sold, it does not cover the full costs of the original debt.
Pawnbrokers – the cons
- Using a pawnbroker can be a relatively expensive way to borrow when compared to other types of borrowing.
- You can usually only borrow a percentage of the value of the item you want to pawn. So if, for example, you have some jewellery worth £200, you might only be able to borrow £100.
What to do if you can’t pay them back
If you can’t repay your loan by the deadline and you don’t want your item to be sold you need to ask the pawnbroker to extend the deadline, but they are not obliged to let you do so.
If you borrowed less than £75 and you cannot repay the loan, the item will belong to the pawnbroker. If you borrowed more than £75, the pawnbroker can sell it but it still belongs to you.
If the loan is for over £100 the pawnbroker has to tell you in advance that they are going to sell it. This gives you a chance to pay them and get your goods back.
The best value for the item must be obtained and any surplus gained – after the debt is paid and costs deducted (such as auction costs) – should be returned.
What happens if you lose your receipt
If you borrowed less than £75 you can get a ‘standard form’ from the pawnbroker which you sign to say the property is yours. Remember the pawnbroker does not have to give you this.
If you borrowed more than £75 or if the pawnbroker will not issue a standard form, then you need to legally swear that the goods are yours by going to a magistrate or a Commissioner for Oaths, or a Justice of the Peace if you live in Scotland. You can also go to a solicitor, but they are likely to charge a fee for this. Otherwise the pawnbroker does not have to give you your property back.
What to do if you feel they have been unfair
Make sure you know the value of the item before you pawn it, that way you have evidence if you feel the pawnbroker has sold it for less than it was worth.
First complain to the pawnbroker in writing. You can use evidence such as newspaper clippings or written quotes to back up your claim. If you need help to complain, the Financial Ombudsman Service (FOS) can contact the pawnbroker for you.
If the pawnbroker doesn’t respond or you don’t manage to sort out the problem within eight weeks, you can take your complaint to the FOS, who may be able to take further action.
You can take a pawnbroker to the Small Claims Court but there are fees to pay and there is always a risk that the settlement reached may not be what you want.
A cheque is a written instruction from you as the account holder to your bank or building society. It authorises payment from your account to whoever is named on the cheque (called the payee). A cheque must be signed and correctly filled in, otherwise the bank or building society may return the cheque unpaid.
If a cheque is crossed and marked ‘account payee’ or ‘account payee only’, it must be paid into the account of the person it’s made out to. However, some companies offer cheque cashing facilities and they will cash a cheque marked ‘account payee only’. They will charge you for this. If a cheque is uncrossed, or ‘open’, it doesn’t have to be paid into an account. In this case, the payee can simply take the cheque to the bank and get the cash.
There are rules about how long it should take for a cheque to clear. These rules apply to cheques paid into current, basic and savings accounts.
In a current or basic account, it should take a maximum of two days after paying in a cheque, before you should start earning interest on the money paid in. You should be able to withdraw the money within four days (six days from a savings account) and after six days, you can be sure that the cheque won’t bounce. These limits are the maximum you can expect, but you might be able to do these things sooner.
If a bank or building society has wrongly advised you that a cheque has cleared, you may be able to claim compensation from the bank if you’ve suffered any loss.
You can get more information about the clearing scheme for cheques from the website of the Association for Payment Clearing Services (APACS) at: www.apacs.org.uk.
You can ask your bank or building society to stop a cheque, that is, refuse to pay out against a cheque you’ve written.
It’s not against the law to stop a cheque. However, it is a criminal offence to hand over a cheque with the intention of stopping it later, although this can be difficult to prove. If you hand over a cheque knowing that the bank or building society won’t pay the amount, that is, it will bounce the cheque, this is also a criminal offence.
If you buy something by cheque and then you stop the cheque, court action can be taken against you for the money owing.
You may wish to stop cheques from being paid from your account if your cheque or cheque book is lost or stolen.
If you want to stop a cheque, you should telephone the bank or building society immediately, giving details of the cheque. The telephone call should be confirmed in writing as soon as possible. You’ll normally be charged for stopping a cheque. A stop will cancel the cheque completely, unless a shorter period is agreed, for example, if you wish to delay payment until you have enough money in your account.
If a bank or building society pays out after a cheque has been stopped, they must repay the account holder. In certain circumstances, the bank or building society may try and get the money back from you, but you can dispute this. If you are in this situation, you should get legal advice.
For more information about getting legal advice, see Using a solicitor
A bank or building society must pay out on (honour) any cheque you write out, provided there is enough money in your account or the cheque is within the limits of an agreed overdraft. A cheque which is not paid out is commonly known as a bounced cheque.
If the bank or building society doesn’t pay out on a cheque when your account is in credit or within an agreed overdraft, you can take action against the bank.
If you don’t have enough funds in your current account to cover a cheque but you do have enough in another account, for example, a deposit account, your bank may use these funds to cover it. However, your bank or building society doesn’t have to do this if it chooses not to. A bank or building society may also treat the cheque as a request for an overdraft, which it may decide to agree to, depending on your credit history.
You should be careful about accepting a cheque from someone you don’t know or trust for an expensive item, like a car. If a cheque is issued fraudulently or is found to be stolen, the money can be taken back even after it has passed through the clearing system. If this happens, you should contact the account holder’s bank straight away. Banks don’t always take back money and each case should be decided on the individual circumstances.
If a cheque is returned unpaid, you can try to recover the amount from the account holder. If you don’t know the account holder’s address, you could:
- write to the branch on which the cheque is drawn
- tell the police if you suspect fraud
- if the cheque is still not paid, you could consider going to court.
Lost or stolen cheques or cheque books
You must tell the bank or building society as soon as you can if you lose your chequebook or you’ve had it stolen.
Are you liable if someone uses your chequebook after it’s stolen?
If you’ve lost or had your chequebook stolen and you think someone has used it to make an unauthorised withdrawal on your account, you must tell your bank or building society as soon as you can.
You will be liable for any unauthorised withdrawals which are made before you tell your bank or building society about losing your chequebook. However, this will only be up to a maximum of £50, unless you have acted fraudulently or been negligent.
You will not be liable for any unauthorised withdrawals after you have told your bank or building society, unless you have acted fraudulently or been negligent.
If your bank is holding you responsible for a cheque which has been lost or stolen, you should get advice from an experience adviser, for example, at a Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by email, click on nearest CAB.
If you’ve not authorised the withdrawal, your bank or building society must refund the money immediately. If there is evidence to suggest you acted fraudulently or were negligent, they can delay the refund while they carry out further investigations. However, the investigation must be carried out within a few days.
Your bank or building society must have a way for you to report a lost or stolen card or where someone else has used the card details without your permission at all times.
Your bank or building society must be able to confirm in writing that you reported your chequebook stolen, up to 18 months after reporting it.
For more information about what to do if someone has used your bank details fraudulently, seeBanking – security and fraud.
Cheques lost in the post
If a cheque is lost in the post, you should complete a Royal Mail claim form, available at post offices, and stop the cheque. The Royal Mail will check whether the letter was delivered and should refund the charge for stopping the cheque. If the cheque has already been presented for payment, you may be held responsible.
For more information about how to complain to the Royal Mail, see Problems with post.
Sending Money with Western Union
The tips below will ensure that your payment through Western Union will be processed as quickly as possible.
1. Remember to indicate the PO number of your order(s) on your payment receipt. This helps us make sure the payment is getting applied to the correct order and speeds up the delivery process.
2. Send an email or give us a call to provide us with your payment information. We will need the following information to process your payment: (Please provide all information requested below.)
a. Sender Name (Please give us your full name.)
b. MTCN Number
c. PO number of your order(s)
d. Amount (The total amount of the money you are sending.)
e. Date（When you send the money to us）
3. Remember to protect your payment information! Please keep in mind that your payment information should be kept confidential and you should refrain from sharing it with the seller.
4. Send the exact amount. If your payment is less than the total price of your order(s), your order will be incomplete and remain unprocessed. Also if you use currency other than US currency, it is your responsibility to send the correct amount using the correct currency conversion rate.
Selling gold for maximum cash
Why selling gold pays
In times of crisis, gold is often seen as a safe investment. Thus the gold price rocketed during the recession, encouraging American ‘cash for gold’ companies to flood in from across the pond to entice us to flog old jewellery and make £100s.
While the price is no longer at the highs it reached during the downturn, even scrap gold can still be worth a mint when melted down and turned into bullion.
Remember, as with other commodities, gold prices fluctuate. If you cash in now, you may lose out or gain more later, but no-one knows for sure. See the current gold price.
How gold selling works
Gold-buying companies’ business models are simple: they buy gold, melt it down and flog it on for more. This means you can get cold hard cash for broken and unloved bling. Yet it’s a Wild West out there, so, make sure you get quotes from several reputable places including:
- Jewellers. Pop into a few jewellers to get a rough idea of what price you should expect. Competition’s hot in certain areas – such as central London and Birmingham – which means top prices. See more on selling gold to jewellers.
- The top postal gold websites. If you go down this route, you’ll first be given a quote online, then you’ll need to post in the gold for verification and only then will you be given an offer. Many gold sites are unreliable or poor players, but we’ve picked some shining examples. See top postal ‘cash for gold’ sites.
Always remember – never just send off your gold to any old TV gold site – some hucksters offer far less than your jewellery’s worth.
Payouts shift each day, according to the price of gold. A little inspiration from forumites’ successes using this guide may help. Please add yours to the Gold Selling forum discussion.
I raided the loft and dug out some old gold jewellery that had been up there since the early ’90s. Hatton Garden Metals promised £890, which seemed a lot. It then delivered £870. The weight was slightly out, as I only had kitchen scales to weigh it on. A couple of items weren’t gold, which I suspected anyway.
I sent some old chains, earrings and rings – mostly 9ct, mostly broken. HattonGardenMetals.com offered £970 – almost double my previous £520 quote from a high street gold shop.
I sold three packs of gold to Lois Gold – mostly broken bits and a few bowling medals. All three transactions were conducted with great speed. My bits and pieces totalled about £1,000 altogether.
Selling gold: The DOs and DON’Ts
While it’s possible to earn £100s, there are gold-plated traps to watch out for. Read these dos and don’ts carefully before parting with your precious bling.
DO remember this is about selling scrap gold
DON’T just send to any old TV gold site
DO send unloved leftovers and teeth
DON’T send jewellery with gemstones
DO check its scrap gold value first
DON’T send posh branded jewellery
DON’T send gold coins or medals
DO send via Special Delivery
DON’T send costume jewellery
DO stay sober
DON’T think the quoted price is the price
DO check the going rate on eBay
DON’T assume it’s the same for silver
Established player with great feedback
In the past, Hatton Garden Metals has always been a top payer and it’s still near the very top. It paid just £1 less than the highest payer in our investigation.
We’ve had almost heaps of positive feedback over the past three years, and felt this was more important than a few extra pence.
When getting paid, you can opt to get an extra 10% on top by selecting Argos or Homebase vouchers instead of cash. For example, if you’ve £100 of gold, you get £110 in vouchers. Do read our gift vouchers warning guide first.
Amount we got for £100 gold bracelet: £51.21 (or £45.31 taking into account postage). Free postage? No. Give us feedback: Hatton Garden Metals
Another good payer, with less feedback
Lois was the only site where the amount promised was identical to the amount received.
Amount we got for £100 gold bracelet: £52.03 (or £46.13 taking postage into account) Free postage? No. Give us feedback: Lois Jewellery
Top payer with potential
It performed well in our test with the top price and speedy service. But as we’ve very little feedback from MoneySavers yet, you may feel safer picking one of the sites above.
Unlike other gold buying sites, there’s no online calculator – you must phone for a quote.
Amount we got for £100 gold bracelet: £52.28 (or £46.38 taking postage into account). Free postage? No. Give us feedback: Gerrards
How to sell to jewellers
The simplest option is to flog your haul to a jeweller in person. Even if you don’t want to sell it, it’s a great way to get it valued. Of course, you’re under no obligation to sell.
Go door to door, haggle and hand over the goods there and then. The good thing is that the gold is with you at all times. But, apart from in specialist jewellery quarters, prices are usually beatable.
Jewellers are the best option if jewellery’s unhallmarked, as they can do a test in front of you. And if trinklets have stones, they’ll tell you if they’re worth owt. Here are our top 10 tips:
1. Take it to three jewellers
2. Check out London and Birmingham’s jewellery quarters
3. Do it with chutzpah
4. Get postal gold prices on the high street
5. Act like you know what you’re doing
6. Make an inventory
7. Get them to do a trade-in
8. Find a registered jeweller
9. Ask where they sell to
10. Sell gold in bulk