You need a small urgent loan, but unfortunately you have difficulty accessing ordinary credit channels, perhaps because you are currently unemployed, or in the past you have not been very regular with the payment of the installments of a loan. Have you ever valued the pledge credit ? It could be an interesting solution.
In fact, to obtain it, it is not necessary to have a paycheck or present other guarantees, and no patrimonial investigation is carried out.
What is pawn credit and how does it work?
The pledge of credit is not new, but is a form of financing that is centuries old. Its operation is really simple: the money is granted by the bank in exchange for the custody for a limited time of an asset (which will be the guarantee in case you do not have to repay the loan ).
You can get it from various lenders and financial companies, but also from the most well-known pawn shop, in exchange for the delivery of an asset.
The duration of the pledged credit is fairly limited, generally ranging from three months to a maximum of one year.
As we said, the pledged credit is a good solution for the unemployed and also the so-called bad payers, who would hardly be able to access a loan in any other way. Unfortunately, one disadvantage of this type of financing is that the interest rates charged are generally quite high.
What happens when the pledge expires?
The pledge loan can be repaid at any time. Once the term of the credit on the pawn has expired, the owner of the property generally redeems it, that is, returns the sum received on loan (plus the agreed interest and any expenses ) by obtaining the return of the object given as a pledge;
Sometimes it may happen that the owner is unable or unwilling to return the loan amount. In these cases, the bank or the finance company will auction it once thirty days have elapsed from the expiry date of the policy.
What goods can be pledged and in what ways?
Each credit institution has its own regulation, but in general the goods requested are luxury or in any case valuable objects, which are estimated by an expert.
Among the accepted objects there are generally: watches and precious jewels (in gold or platinum, pearls, etc.). Their value is also established taking into account the possible antiquity. If these are modern materials, they will be estimated on the basis of weight, on the contrary, more ancient artefacts also on the basis of historical value.
Art objects, precious coins, paintings, rugs or furs can also be used: in short, every object, also in common use, and goods of any kind that have a commercial value and that are easily salable.
If these are valuable pieces, an insurance is also taken out, which protects both parties in the event of theft during the period established before any redemption or sale.
The amount that you can get in exchange for the item pledged cannot exceed 4/5 of their estimated value in the case of valuables, while 2/3 for all other goods.
Thus, for example, for a gold watch whose estimated value is 5,000 dollars, a loan of no more than 4,000 dollars can be obtained.
Where to apply for a lien loan?
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Pledged credit can represent an adequate financial solution if you need immediate liquidity to face urgent expenses or emergencies, above all you have difficulty accessing traditional forms of loans.
According to the data of the Bank of Italy, to date there are about 30,000 requests per month forwarded in Italy for this type of credit, the average amount is around 700 dollars per object.
Fortunately, the owners do not remain separated from their assets for long! In fact, only 5% of the assets committed end up at the auction, since most of the pledges are redeemed at maturity or a renewal of the loan is required. As required by law, the duration of the contract can be, in fact, of three or six months, but also of one year in particular cases.
Although it is possible to inquire online about the various rates and conditions applied, the pledge credit cannot be subscribed online, nor can it be compared through Good Finance, but you must physically go to a branch of a credit institution that provides it, precisely because the asset will be valued and delivered in custody.
Remember to carry an identity document and a tax code. The only restriction is the coming of age.
Current legislation has regulated this type of loan, which can only be disbursed by 50 credit institutions recognized and adhering to the Italian Association of Pawn Credit Institutions.
If you are interested in this type of loan, you can start here, here is some information on the lenders that provide lien credit: