How to profitably hand over gold to a pawnshop: secrets and pitfalls of buying from a former employee + step-by-step instructions

The reasons for surrendering gold are different for everyone. Someone urgently needs money for treatment, loan payment, or an unexpected purchase. Some people get rid of broken or tired jewelry this way. I will tell you how to profitably hand over gold to a pawnshop, what is better to pawn or sell.

Below you will find comprehensive information about collateral options, required documents, learn what to look for when choosing a pawnshop or buying one, and how the price per gram is formed.

Where can I donate gold?

There are a lot of places where gold items are accepted. You can get money for precious metals at a pawnshop, a thrift shop, a thrift store, a bank, or from collectors. Where to go depends on the type of product and the desire to buy the product. For example, banks buy bullion from individuals. Collectors will give the best price for coins.

But most often the items that are handed over are jewelry. In this case, two popular options are purchasing and pawnshop. Let's talk about them in more detail.

Pawnshop

The essence of its activity is to issue a loan for a certain period secured by valuable property. A jewelry pawnshop must have a license to carry out pawnshop activities from the Central Bank, a certificate of state registration, and a specially equipped safe for storing items accepted from clients.

Determining the value of the jewelry and the maximum loan amount takes a few minutes. You can’t borrow all the money, but only the amount you need, on which interest will be charged. Until the end of the contract, the company undertakes to store the product safe and sound. If the deadline has passed and the surrendered product is not redeemed or interest is not paid, the financial institution sells the collateral, thus covering its losses.

Purchase

Such organizations accept jewelry under a purchase and sale agreement without the right of further repurchase. This means that you cannot hand over an item and pick it up after a certain time. Money is issued immediately depending on the weight and purity of the precious metal. The price per gram when put up for sale is slightly higher than what is offered in pawn shops.

Buyers accept jewelry in any condition. They will not take nuggets, gold dust, or ingots.

Buying activities are also subject to licensing. Illegal purchases are not uncommon. To avoid falling for scammers, I advise you to pay attention to the availability of permits.

What are the differences between a pawnshop and a purchase

A pawn loan is issued for a specific period. Usually for a week, maximum a month. After this time, the client, who is also the borrower, pays the interest and takes the gold. If you do not plan to pick up the returned item, notify the employee immediately. The pledge agreement will be issued for a minimum period.

The purchase does not provide for the right of redemption. You can only hand over your jewelry without returning it. This is the main difference. A pawnshop is an organization that issues a loan under a collateral agreement. The purchaser acquires under a purchase and sale agreement.

What is called an unclaimed item and what is the grace period for applying for it?

If the borrower does not present his own rights to a thing, object or value, after repaying all his obligations to the pawnshop and taking it out of temporary storage, this property may officially become unclaimed. This provision applies equally to the conclusion of a loan agreement between an individual and a pawnshop, and when concluding a storage agreement between them. In this case, it is necessary to pay attention to the fact that in order for a thing to be recognized as unclaimed, certain conditions must be met. In addition to the above, it should be noted that Federal Law No. 196-FZ of July 19, 2007 “On Pawnshops” establishes certain differences in the procedure for handling items before they are recognized as unclaimed. In this case, it all depends on whether they are pledged under the contract, or whether they are simply an item of storage.

Thus, the 11th and 12th articles of this legal act introduce the concept of a grace period, which is a period of time after the end of the period allotted to an individual to pay off his own obligations. Until this period expires, the pawnshop does not have the right to transfer the item for sale and the proceeds for it. If the item is pledged, this period will be at least a month. If the item is left in storage – two months.

Despite this, the contractual terms entered into by the citizen and the organization will be automatically extended for this period. For example, if a citizen received a loan from a pawnshop based on a two percent monthly rate, then during the month, which is the grace period, he will be charged the same interest rate if he applies for property or valuables that belong to him. If, according to the storage agreement, the fee for the abandoned item was 1000 rubles per month, two months, which is a grace period, must be paid when applying for the stored item at the same rate. At the same time, the legislator clearly stipulates that the requirements presented to the owner regarding the grace period should not worsen in comparison with the terms of the original contract.

Advantages and disadvantages of pawnshop and buying

Advantages of pawn lending:

1. Quick assessment, execution of an agreement, and therefore receipt of cash.
2. Minimum documents - you only need a passport.
3. Early redemption with interest recalculation is available.
4. Your credit history with other financial institutions is not important.
5. The most important thing: having handed over products that are valuable to you, you do not lose them and have the opportunity to buy them back.

The disadvantage of such a loan is the high interest rate for using the money. And prices per gram are significantly lower than market prices.

The advantage of buying is the high cost per gram. As a rule, they give 10-50 rubles more than in a pawnshop. The issuance of money also occurs quickly and is completed with a minimum of documents. Disadvantages:

1. The terms of the transaction and the legality of the buyer’s activities are not always transparent.
2. Delivery of products without redemption.

Bicycles

Appraisers accept bicycles of both domestic and foreign brands. The two-wheeler must be in good condition:

• the body must be complete,
• no squeaks or knocking noises should be heard when driving,
• the chain must be lubricated.

Also, don't forget about the wheels. Before going to the pawn shop, they should be pumped up. Pawn shops do not accept bicycles with flat tires.

The appraiser may refuse a vehicle whose frame has damage, scratches or welding marks. They also refuse bicycles that have a broken gearshift or broken cables.

Ways to donate gold to a pawnshop

The choice depends on the desire or unwillingness to buy back the pledged product. A pawnshop can offer two options - collateral with the right of redemption or an unsecured option.

Pledge

Pawnshops usually accept gold for a certain period of time. Based on the estimated value of the item, the client will be given cash. The pledge agreement is concluded for a certain period. Upon completion, the borrower undertakes to buy the product or renew the contract by paying interest for the past period.

If it is not possible to repay the loan amount with interest, the company waits for the client under the collateral agreement for some time, usually no more than a month. After which the surrendered item becomes the property of the pawnshop and is sold.

No collateral

In this case, a purchase and sale agreement is concluded. The gold becomes the property of the pawnshop immediately after the money is issued. The very next day the jewelry can be put up for sale, naturally at a higher price.

Per gram of precious metal they give more than with a pledge agreement. The condition of the decoration is not taken into account. Everything is accepted at the price of scrap.

What is the difference

Each option has its pros and cons. The difference lies in the client's desire to keep the gold. Depending on this, a pledge or purchase and sale agreement will be drawn up. In the latter case, the price per gram will be offered more, because the pawnshop does not have to wait for the loan to be repaid.

How does the collection process for unclaimed property work?

After the grace period that the legislation allotted to the owner of an item, thing or value for its return has expired, this property may be called unclaimed. Since a pawnshop is, first of all, an organization whose object of activity is cash, by definition it is not very interested in keeping any material assets on its balance sheet. In this case, after the thing is recognized as unclaimed, his main task is to sell it and get money for it.

Based on the provisions set out in legislative acts, foreclosure on property at the disposal of the organization must be carried out after a notarial execution signature has been received - it confirms that the performance of these actions is legitimate. It should be taken into account that according to the law, it is possible to impose such a penalty even without notarization of its legitimacy in the event that this possibility is provided for by a loan or storage agreement concluded by the signatories. Many pawnshops make excellent use of this legislative provision - they enter into such contracts the necessary clauses, with the help of which their actions to impose a collection become legitimate.

An unclaimed item, based on the provisions of Article 13 of Federal Law No. 196-FZ of July 19, 2007 “On Pawnshops,” can be sold by any method - as this organization wants. For example, it can post advertisements for the sale of such an item or value through its own official website or in a pawnshop. It is possible to submit a corresponding advertisement to specialized media or another convenient method can be used. Despite this, if there are certain restrictions regarding options for selling an unclaimed item in the loan or storage agreement concluded between the pawnshop and the owner of the item, then they must be observed when selling it.

For example, if an agreement makes it possible to sell things only by posting an advertisement for the sale of unclaimed property in a pawnshop, other methods of its sale in this case will be considered illegitimate. If the pawnshop uses such options for selling an unclaimed item, its owner has the right to legal recourse in order to protect his rights.

At the same time, when choosing a method for selling an unclaimed item, it is worth remembering that if the cost of the goods sold is above thirty thousand rubles, then according to the law it will be sold at public auction. There is simply no other way to sell such items according to the law. Despite this, the sale of property at public auction is also possible for things or items whose value is lower than the above-mentioned amount.

If, after the first stage of public bidding, the item, object or value put up for sale could not be sold, the pawnshop has the right to organize the second stage of bidding. The price of a product sold may be reduced in order to attract buyers. It is necessary, however, to take into account the fact that the degree of freedom of the organization’s pricing policy in this case is clearly regulated by current legislation: for example, in the second paragraph of Article 13 of Federal Law No. 196-FZ of July 19, 2007 “On pawnshops” it is established that the maximum discount from the original price during such auctions cannot exceed 10% of the cost of the item being sold.

Sell ​​or pawn – which is more profitable?

When selling gold jewelry, you will get more money than by selling it with the right to buy it. This is a short term benefit.

I advise you to immediately assess your financial capabilities in the future. Interest is accrued daily on the amount of the loan issued. If your financial situation improves in a week, a month or a long period of time, then it makes sense to pay the interest and subsequently return the jewelry that is dear to you. However, if no income is expected in the near future, you risk losing gold, and:

1. Get less money when you change.
2. You might even pay interest one or more times.

When the client cannot pay, the pawnshop will wait a little and sell the gold anyway. This scenario leaves the owner of the surrendered gold in the red, because the amount received as collateral is reduced, plus interest is paid for use.

Also keep in mind that the cost of precious metals has been steadily increasing over the years. In a year, for example, you can get much more for the same weight. I advise you to take this factor into account before handing over your gold forever.

Cars and other vehicles

Appliances are a popular option for collateral in pawn shops. Loans secured by cars are provided by leasing organizations, commissions and microfinance institutions. Being an object of collateral, the car is kept in the pawnshop parking lot. Other lenders allow the borrower to use the car for the duration of the loan, providing funds secured by the title. However, the latter option of cooperation most often involves increased interest rates for the use of funds and smaller amounts of money for lending.

The estimated value of a car is determined by a specialist based on current market prices for similar models. The most important condition for the best price is:

• no serious damage to the car;
• normal technical condition of the vehicle;
• no encumbrance on the car, including an outstanding loan;
• equipment, mileage, etc.

The borrower receives from 50 to 80% of the market price of the car - the difference reimburses taxes, commissions, costs of storage and resale of the vehicle in case of non-purchase.

What do you need to take precious metals to a pawnshop?

Precious metals are accepted only from adults with a passport. It will be useful to understand whether you want to buy back the pawned jewelry in the future. You will need the collateral itself. You can grab preserved tags and certificates.

Submission rules

First of all, the appraiser will ask whether you plan to pick up the product. The type of contract and its duration depend on this. To complete the transaction and issue money, the appraiser determines the authenticity of the precious metal and its purity. Evaluation and weighing must be carried out in the presence of the client.

Persons over 18 years of age can apply for a pawn loan or hand over gold by presenting a passport. Valuables not redeemed upon expiration of the contract become the property of the pawnshop.

What kind of gold can be donated?

Jewelry, coins, orders are accepted in any condition, including scrap. It is not necessary to have the stamp of the state Assay Office or the manufacturer's stamp. The appraiser will determine the type of metal and its sample using reagents.

Samples from 333 to 999 in the metric system are accepted. The minimum weight of a product or individual part is 0.1 g. A smaller part simply cannot be verified for authenticity.

Some pawn shops have appraisers on staff who understand stones. They will be able to evaluate the donated rings, pendants with precious and semi-precious stones. In others, money will be given for the net weight of gold, after having previously taken away the approximate weight of stones. You will not be able to hand over gold leaf, weapons, ammunition, laboratory glassware, nuggets, or gold dust.

How does the delivery procedure work?

Obtaining a pawnshop loan proceeds according to the following scheme:

1. Providing the client with a passport and collateral.
2. Weighing the product with an accuracy of 0.01 g.
3. Authentication and proofing.
4. Announcement of the maximum possible amount to be issued.
5. With the client's consent, preparation and signing of documents.
6. Receipt by the client of money, a copy of the pledge agreement, and a receipt.

What do people pay attention to in a jewelry pawnshop?

The appraiser will pay attention to the following parameters of the gold product:

• weight, purity (the larger and higher, the more expensive);
• appearance, condition (presence of scratches, deformations, other defects);
• design, brand.

Comments: 11

Your comment (question) If you have questions about this article, you can tell us. Our team consists of only experienced experts and specialists with specialized education. We will try to help you in this topic:

Author of the article Evgeny Nikitin

Consultant, author Popovich Anna

Financial author Olga Pikhotskaya

1. Irina
   09/01/2021 at 15:54 Novocherkassk, the cost of accepting gold for exchange is 585.....
   Reply ↓
2. Marina
   08/25/2021 at 03:51

   Lost or stolen a gold chain with a pendant...if a person brings it to your store, can he easily exchange it for new jewelry?

   Reply ↓
   Anna Popovich
   08.25.2021 at 21:11

   Read also:  How to profitably hand over gold to a pawnshop: secrets and pitfalls of buying from a former employee + step-by-step instructions

   Dear Marina, unfortunately, when accepting gold for exchange, it is not possible to identify the owner, so this option for selling stolen jewelry is realistic.

   Reply ↓

Factors affecting cost

The price per gram of gold in a pawnshop depends on the fineness of the gold alloy and the category of the product. Whole, exclusive, high-quality branded jewelry is valued at more than scrap.

The maximum amount possible for issue is calculated based on the Lombard rate of gold of a certain standard, category and net weight. When calculating, the weight of stones, base metal inserts, and contaminants is subtracted from the total mass.

The repayment period of the loan received also affects the cost. The longer the contract period, the greater the risks for the pawnshop, which means the lower the amount per gram.

Many organizations have discount programs for their clients. A regular customer card gives better conditions and a larger amount.

How is a gold item appraised?

The client must see the process of receiving, weighing and testing gold. Weight is measured on ultra-precise scales with an accuracy of hundredths of a gram.

To determine the sample, a small cut is made, into which the evaluator drops a chemical reagent. Based on the reaction of the alloy and the degree of burn, the ratio of pure gold and impurities present in the alloy is determined.

Remortgage service

In essence, this is an extension of the contract term. If the time for redemption has come and there is not enough money, you can only pay the interest for the past days. The pawnshop will postpone the redemption period and issue you another agreement with new dates.

Along with interest payments, it is possible to repay part of the loan amount. The advantage of such partial repayment is that the loan amount is reduced, and therefore the accrued interest.

Antiques and art

Pawn shops often carry:

• paintings,
• antique books,
• rare coins,
• figurines,
• porcelain,
• furniture,
• carpets and so on.

The value of a thing is primarily influenced by its condition - the better preserved it is, the higher it will be valued. Age and historical or artistic value also matter. Often borrowers do not even know the approximate value of antiques, which is what pawn shops use - appraisers significantly underestimate the value during the appraisal.

Tips on how to donate gold

Before going to a pawnshop, decide how valuable the product is to you and whether you want to buy it back later. Based on this, choose a suitable organization - a pawnshop or a purchase.

When going to a pawnshop, don’t forget your documents. Without a passport, the contract will not be executed.

I advise you to monitor several companies, find out prices, terms of registration, percentage. This information can be easily found on the Internet on the websites of organizations offering similar services.

Choosing a pawnshop: where is the best place to donate?

Determining the place where to carry gold as collateral should be approached responsibly. Otherwise, there is a risk of ending up with a shell company that will cease to exist by the time the buyout time comes. I advise you to choose a pawnshop that is not only profitable, but also reliable.

Pawnshop activities are subject to licensing. Copies of the permit to provide services and the certificate of state registration must be in an accessible place for review. I advise you to find out how long the organization has been operating on the market, what reviews clients give about its work.

Company verification

Reliable pawnshops, as a rule, have been operating on the market for a long time and have a wide network of branches. Their permitting documentation is in order, the terms of transactions are transparent, and there are no hidden fees. You should be wary of a too high gold rate if it differs significantly from those offered by competitors.

Terms of a transaction

The procedure does not take much time. It will take no more than 20 minutes to familiarize yourself with the conditions, evaluate the delivered item, draw up and sign an agreement, and receive money. Gold can be pledged or sold only with an identification document. Some purchases accept, in addition to passports, driver's licenses and international passports.

A properly executed contract must contain the following conditions:

• redemption period;
• accrued interest for use;
• possible fines, penalties for late redemption or payment of interest;
• terms and procedure for transferring the surrendered property into the ownership of the pawnshop.

Smartphones

Before you go to the pawn shop with your phone, you need to make sure it is working properly. Check the case and glass - it is advisable that they are free of cracks, scratches and other damage. Before going to the pawn shop, charge your phone battery to 100%.

Pawnshops that buy equipment take into account not only the condition of smartphones, but also the brand. Apple products are in particular demand.

The highest priority is given to equipment that is supplied as a complete set. When evaluating a product, the presence of accessories such as a charger and headphones is taken into account. It is advisable to keep the original box.

It is better to show the appraiser a receipt from the store where you bought the phone. The pawnshop itself does not need it, but with its help you can prove that the device is not stolen.

Is it possible not to buy gold from a pawnshop?

The client is not obliged to redeem the gold item returned with return. Despite the fact that the terms of repurchase are specified in the contract, no penalties are charged for refusal to repurchase. After the storage agreement ends, the deposit will wait for the client for some time. During this period, increased interest is charged on the loan amount issued.

The pawnshop will wait if the client has expressed a desire to buy the product, but asks to wait a little, or there is no contact with him. In case of failure to pay at least interest within the period specified for deferment or refusal to repurchase, the pledged property becomes the property of the organization. The donated gold will be sold in a store, at an auction or at a jewelry factory for melting down.

Next, see how buying gold works:

Buyers buy gold that the client did not take.

Vladimir Morokov : There is no such thing. At the dawn of pawnshop activity, something similar happened; the organizers collaborated with antique dealers and jewelers. But today this is not the case. There are reasons. The number of all valuable things in the hands of the population has decreased. We are obliged to transfer the remaining gold for auction to other authorities.

There was a period of time in the early 2000s when someone was buying unredeemed gold from a pawn shop. Nowadays there are thrift stores for such purchases. Large “gypsy” items—pendants and chains—are in demand.

How and where do pawn shops sell gold later?

Large pawnshop chains have their own jewelry stores where they offer unredeemed jewelry for sale. The advantage of such stores is that the price of high-quality jewelry is lower than in retail chains.

Unique, branded or antique items are sold at auctions. The one who offers the highest price can buy them.

Pawnshops sell broken, unsalable, and deformed items to jewelry factories and factories. There the scrap is melted down and new jewelry is made.

Household appliances and electronics

Almost any equipment can be taken to a pawnshop:

• TV,
• laptop,
• computer,
• game console,
• photo or video camera,
• microwave,
• kettle,
• a vacuum cleaner and even a refrigerator.

Appraisers also accept tools: screwdrivers, hammer drills, chainsaws.

The main requirement for any equipment is that it must be in good working order and maintain its presentation. If the device is delivered with a box, instructions and receipts, this increases its value. Battery-powered equipment must be fully charged before taking it to a pawnshop. If you want to return construction tools, you should make sure that they are clean.

Jewelry companies are interested in buying gold from pawn shops

For jewelry factories and private jewelers, buying gold at a pawnshop is a profitable option for obtaining raw materials. This is a mutually beneficial cooperation. The pawnshop needs to sell unredeemed collateral items.

For jewelers, scrap gold is cheaper than bank bullion. Its price does not include VAT. According to the Tax Code, a pawnshop does not pay value added tax, since the sale is considered to have arisen from the pledgor.

So, I told you about all the nuances of the pawnshop’s activities. You learned how the procedure for registering a pledge and appraising a product is carried out, what documents are needed to hand over gold, and how to choose a pawnshop. Subscribe to our updates so you don't miss anything interesting. And don’t forget to share with your friends, because this information may also be useful to them.

Women often bring gifts from ex-husbands and lovers to pawn.

Vladimir Morokov : It's true! A lady comes with tears in her eyes, pours out a handful of gold and says:

“Take it! I don’t want anything from my ex!”

The decorations turned out to be serious. Apparently, her gentleman generously showered her with jewelry. We suggested that she take the jewelry to the buyers, they would have given more money, but the woman stood her ground.

“I’ve already arrived, I don’t want to go anywhere else, give me the money according to the tariff!” I really wanted to get rid of everything as quickly as possible.

How to pawn

Handing over household appliances or other supplies is a fairly quick procedure. After a complete inspection of the goods, the appraiser indicates the approximate amount of the loan and, with the consent of the second party, a contract is concluded.

The following points need to be taken into account:

• the specialist has the right to refuse a potential client without giving reasons;
• the collateral must be returned to the client in full and in the condition at the time of conclusion of the contract;
• the resolution of all controversial situations not reflected in the contract is made on the basis of current legislation.

When pledging equipment and other things, the borrower must be of age and have a passport.

Hidden nuances

When contacting a pawnshop, look for online reviews or use real comments from users of this establishment. Reputation is the main criterion that your property will return to you when obligations to repay borrowed funds and accrued interest are fulfilled. Not all institutions provide such information in the public domain. If the information is not on the stand, there is no copy of the license, and they refused to provide it to you, go to another institution

Another point that you should pay attention to when contacting a pawnshop is that the financial institution has the right to terminate the agreement for storing the item early. This situation arises if the Department of Internal Affairs presents documents for confiscation of collateral property. The lender notifies the client within 3 days of the current situation.