How to Negotiate at a Pawn Shop

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A few weeks ago, I wrote an article for Mint explaining why pawn loans aren’t a terribly good alternative to bank loans. I received a surprising number of emails asking how best to deal with the pawn guys in order to get as much as you can from them when selling an item or borrowing money against it. First and foremost, selling stuff to pawn dealers isn’t a smart way to get maximum dollar but, if you insist, these tips will help to even the playing field.

Don’t tell them where you got it

Nothing drives me crazier than watching the various pawn shop shows and seeing some bozo brag how he “found it at a garage sale.” What exactly are you telling them when you make such claims? You’re telling them that it has no sentimental value to you. This means you’re more likely to accept an amount that yields a small profit, since you clearly don’t have much emotional skin in the game. It’s none of their business where you got it… so leave it at that.

Don’t tell them how much you paid for it

When you buy something at a store do you ever ask, “How much did you pay for this?” When you borrow money from a bank do you ever ask, “What is your cost of funds?” Of course you don’t. The minute they tell you their costs, you know roughly how much they’re making off the sale at the sticker price. This is why websites like Edmunds are so helpful to car buyers. They tell us how much the dealer paid for a car before we start talking about how much we’re willing to pay them for the same car. It’s none of their business how much you paid for it.

Don’t tell them you know how much it’s worth

When you’re dealing with a pawn shop you have to keep one thing in mind: They’re there to make a profit and you don’t make a profit unless you sell something for more than you acquired it for. It’s THEIR job to determine your item’s value. If you know your gold coin is worth $1,000, then you’re one step ahead of them because they’re still trying to figure out the value. If they really want to buy your item, then let them expend the energy to have it appraised.

Find out how much its worth on your own

If you walk into a pawn shop and try to sell an item without knowing its value, then you’re asking to be ripped off. Much of what we own has no market value.  However, things like jewelry, watches, cars, antiques and art are easily appraised for a fairly reasonable price. Don’t walk into a pawn shop trusting that their “appraiser” is going to give you a fair valuation. They likely work for the shop, which means they’re going to low-ball the item so their employer can acquire the item for much less than the true market value.

Let them make the first offer

There’s one indisputable fact in negotiations: He who makes the first offer loses. It’s not a secret that everything is for sale and it’s no secret that we have an amount in our mind that we’ll take for almost anything we own. Whether it’s a proper amount or not, sharing that amount first will almost always lead to a better deal… for the other guy. If you know you want $1,000 for your gold coin, then let the pawn dealer make the first offer. If he offers substantially less than $1,000, you’ll know you’re not even in the ballpark. If you tell him you want $1,000 for the coin, you’re likely to get an offer around $500 because most pawn dealers will try and acquire the item for about half of its real value.

Be prepared to walk

If you think you’re getting taken, walk out the door. Pawn shops are not going to offer you retail price or even wholesale price. They’re going to offer you as little as they possibly can to acquire your item, or what I call “pawn shop value.” This will be less than 50% of what they think they can sell it for. That means you’re paying a middleman to liquidate your item. You’d likely do better selling your item on eBay or at an auction.


John Ulzheimer is the President of Consumer Education at, the credit blogger for, and a contributor for the National Foundation for Credit Counseling.  He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and, John is the only recognized credit expert who actually comes from the credit industry. The opinions expressed in his articles are his and not of or Intuit. Follow John on Twitter.

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