When people need money fast, some think that pawn shops are a great way to get the funding they need quickly. This may work for some individuals but pawning an item when you need fast funding can be tricky—so it is important to know all the facts.
The Alabama Pawn Shop Act is a legislative statement outlining the rules and regulations of the pawning process, pawnbrokers’ rights, as well as pledgor’s rights. Whoa wait, what is a pledgor? Don’t worry, we have that answer—along with some essential information about the Alabama Pawn Shop Act that will keep you informed, especially if you are thinking about pawning an item for some fast money.
Important Terms in the Alabama Pawn Shop Act Defined
Here are a few important terms you should be familiar with when learning about the Alabama Pawn Shop Act:
- Pledgor – The pledgor is the person who puts up, or pledges, items to a pawnbroker in exchange for money. If you pawned your car in order to receive some extra money, you would be the pledgor in this situation.
- Maturity Date – the maturity date of a pawn is a previously agreed upon date between the “pledgor” and the pawnbroker when the “pledgor” must repay the money lent to them at the beginning of the pawn transaction.
- Pledged Goods – The material goods the “pledgor” pawns if you pawned your car, your car would be considered the “pledged goods.”
- Lien – a lien in a claim of ownership over something that was previously owned or used by someone else. When you pawn an item, the pawnbroker will hold a lien over whatever goods you have pawned until you have redeemed your items.
- Pawn ticket – a brief, physical statement with information about a pawn transaction. A pawn ticket should contain information such as the date of the pawn, the maturity date, a unique “pawn number,” and any other significant details about the pawn transaction.
Key Parts of the Alabama Pawn Shop Act
Some of the different sections of the Alabama Pawn Shop Act have to do with pawnbrokers and the certain restrictions that apply to them. While this is important, you are probably more concerned with the parts that apply to you if you are ever in a situation where you need to pawn something for some cash.
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Here are some of the key components of the Alabama Pawn Shop Act that might affect you:
- Section 5-19A-6 – This section is important. Section 5-19A-6 of the Alabama Pawn Shop Act basically says that if you do not redeem your property within 30 days of your maturity date, then your property legally belongs to the pawnshop now.
- Section 5-19A-7 – This section of the Alabama Pawn Shop Act states that it is perfectly legal for pawn shops to charge an initial fee instead of charging for “interest … services, expenses, costs, [or] losses of [any] nature…”. Furthermore, if a pawn shop tries to charge you any kind of interest fee then the pawn transaction is considered void.
- Section 5-19A-8 – This section makes sure that pawnshops follow a certain procedure and set of rules to make sure their records are legitimate. This includes, staying current with the records in their books, keeping them honest, and allowing the proper authorities to look at their current (and reliable) records whenever they ask.
- Section 5-19A-9 – Every time you pawn an item, and for each item that you pawn, the pawnshop should give you a “pawn ticket.” At any time before the maturity date you can present your pawn ticket to the pawnbroker to redeem or repurchase the “pledged goods.” If these goods are damaged or destroyed (while in possession of the pawnbroker) before you redeem them with your pawn ticket, it is up to the pawnbroker to either replace your items. Also, if this ticket is lost, stolen, or destroyed, it is up to the pledger to notify the pawnshop, who will then create a new pawn ticket—rendering the first/misplaced ticket void.
- Section 5-19A-10 — When you decide to pawn an item, the pawnbroker has a slight ownership of that item until you exchange your pawn ticket for your pledged goods. If you fail to redeem these pledged goods before or on the maturity date, you still have 30 days to redeem your items. However, the pawnshop may charge you an additional fee, which in this case is legal.
- Section 5-19A-15 – It is possible to place a seven-day hold on your pledged goods, during which time your items cannot be sold or confiscated. A hold may be put on pawned pledged goods if and only if one or more of the following apply:
- A police report is filed in an efficient manner
- There is a warrant out for the arrest of the person who pawned the items in question
- A warrant is issued for the merchandise itself
Are Pawns a Good Way to Get Fast Cash?
After reading all the rules and regulations that come along with any pawn transaction, you may want to think twice before you dive into this kind of transaction.
If you need funding in an efficient manner, you might want to instead, consider a car title loan. Getting a car title loan from LoanMart is a smart way to borrow money, because you are using money have already invested into your car to secure the loan.
Here’s how you can get an awesome deal on a car title loan from LoanMart1. You can even receive your funding in as little as 24 hours3!
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Send in your documents
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Pawn transactions can be time consuming and risky, but with LoanMart car title loans in Cleveland your financial success is just around the corner. Get started on your LoanMart car title loan today!