Do Pawn Shops Pay a Fair Price for Gold?

If you are looking for some extra cash, jewelry is one of the most viable options. You can get a substantial amount from jewelry you have which can help you in your time of need. There are a number of ways to sell your gold, each with its own pros and cons. One such option which is always available are pawn shops.

Gold is a heavily traded item which is traded in the open market and has a varying price similar to those of currencies. An advantage of gold being a heavily traded item is the fact that at any given point of time, the price of gold is constant regardless of your location. You can reliably predict how much gold would cost you, if you were to buy it or how much you can get, if you were to sell it.

Before going to sell your gold, know its value

You should be aware of the value of your item before you go to a shop to sell it. One way to do that is to get a qualified appraiser. They can determine the properties and value of your gold in order to give you an idea of how much your jewelry is worth, if bought new. Getting it appraised from multiple sources is also a good idea, since it allows you to fetch a higher appraised value as well as having multiple sources of confirmation about the gold’s value.

You should be familiar with the current market and fashion trends. A good appraiser and jewelry salesperson can answer your questions, so inquire as much as you can. A piece of jewelry which is currently in trend might sell for more than a piece which is not.

Another important factor is, does the jewelry have history? Your jewelry or item might be worth more than its raw gold If it belonged to someone prominent, or if it has some historical significance, you can expect a much higher offer than you would get for gold of same weight.

There have been auctions where items sold for tens of thousands of dollars because of their historical significance, which would otherwise not have a worth of more than a few hundreds of dollars if purely judged by their material. Before you decide to scrap the piece or sell it purely based on its weight, make sure to dig deep into its history.

Prepare the item for sale

Appearance can go a long way in convincing the pawnbroker to give you a good deal. A dusty and old looking necklace you bought for $10,000 might not even sell for 10% of its value because the pawnbroker was not convinced of its market value. However, a necklace which looks new might fetch a lot more if it can appeal to the pawnbroker’s eye.

You can clean the item for yourself with a few household items, there are a number of helpful guides available on the internet. Or, if you are not comfortable handling this yourself, you can ask your local jeweler to do this for you. They handle most cases of maintenance fairly economically, and you would often end up spending fairly less on maintenance than the money you would gain while selling the jewelry.

How much would your gold fetch you at a pawn shop?

This obviously depends on a number of factors. However, you will certainly be getting significantly less than the original price you paid for the jewelry. The same goes for the appraised value of the jewelry. The appraised value gives you the price for the piece when it is bought new when you factor in the cost of manufacturing, store operations, etc. Selling it back to the store or a pawn shop loses a lot of that value.

You can get anywhere between 30-70% of the value of the raw gold the jewelry has, since the pawn shop also has to factor in the cost of melting it down and to form it into new jewelry or into raw gold bullion. Some plain chain appraised at $250 was offered between $130-150 at several jewelry stores as well as at pawn shops. Similarly, a $600 necklace was not offered more than $320 at several shops and stores.

You can get a higher value if the piece itself is marketable, has a history, or if you sell it for scraps. Selling it for scraps means that you have melted the piece yourself and are selling the raw materials. It also makes it easier for you to get an offer, and can be beneficial if you have a number of smaller items. However, you should be well aware of the quantity of gold and quality of jewelry before you decide to melt it, so make sure to get it evaluated from one or more appraisers.

Selling it to a pawn shop does not have any distinct disadvantages when compared to selling it to a jewelry store. Due to the heavily traded nature and market of gold, both tend to offer similar prices. A pawn shop has the advantage of being more flexible and can even offer you loans or various deals which might suite you better.

As always, an option is to sell the gold directly to a buyer, which generally has the highest return. This skips the costs a pawn shop or a jewelry shop might have for gaining a profit and can fetch you a price closest to what the piece is worth. However, that may require you to search for a buyer and wait. If you do not wish to go through this ordeal, then selling it to a pawn shop is a good option. They offer fair prices when you factor in their costs and are very competitive to jewelry shops. You can find a number of trusted pawn shops who are known to trade in gold at our site.

What To Expect When Going To A Pawnshop

what-to-expect-when-going-to-a-pawnshopIf you have something that you want to sell, you may post a local ad or list your item online. But another option that many forget is taking it to your local pawnshop. If you have never sold an item to a pawnshop before, we are here to help know what to expect and understand the different option you may have. Cash for Gold dealers and pawnshops can get a bad reputation for offering lower than expected prices, but having an idea of how they operate will give you a better perspective of what to expect. We will now break down the different stages to selling an item to a pawnshop.

Step 1 – Evaluating Your Item

Lets say you bring in an old piece of jewelry that you would like to exchange for some money; the first step is having the pawnshop inspect what you have. Each item that is brought to them will be analyzed in various ways and even referenced to current online prices of similar items. Jewelry has its own way of being valued, and precious metals have the market price that why are trading at. Some pawnshops may be more experienced with different items and shopping around can earn you more money, because the more confident the pawnshop is in the value of the item, the more they are willing to offer.

Step 2 – Negotiating Your Price

Negotiating is where most people lose out on money and often where the pawnshop gets a bad reputation for low-balling. Everyone will have a different level of skill when it comes to negotiating, but by understanding where the pawnshop has leverage will give you an idea of where they are with their offer. For example, you may have a very nice piano that is often sold for $5,000. The pawnshop will offer you less than $5,000 so they are able to make a profit, but then the offer will also be considerably less because of the size of the item and the lack of buyers. If you had a ring worth $5,000, you would be able to say the opposite of the piano; that it does not take up much space and many engagement rings are sold at the store. Knowing how different items will produce different percentages of their value can help you understand why the pawnshop is making their and counter with reasons to raise the offer when negotiating.

Step 3 – Sell or Pawn?

The great benefit a pawnshop has over selling something online, is the ability to get your item back in the future. To pawn an item means to exchange the item for cash, and in a certain amount of time (usually 30 days) you can get your item back for a small interest fee. For example, you need $500 for rent so you don’t get evicted but cannot come up with the money; you also have a valuable necklace that is a family heirloom that you cannot sell. In this scenario, you could pawn the necklace, receive the $500 you need for rent, and then receive the necklace back in a month for ~$550 when you get paid. By pawning, you are able to stay in your home and keep the family heirloom that you cherish.

This is what you can expect when entering a pawnshop. These are businesses that are there to make money so don’t expect to get the market value for your item. The benefits of pawning and getting cash on-the-spot are extremely useful when needed. Our site lists several pawnshops all over the country and has information to help your earn the most cash for gold.