Pawnshops Law and Legal Definition
Pawnshops are in the business of lending money on the security of pledged goods left in pawn, or in the business of purchasing tangible personal property to be left in pawn on the condition that it may be redeemed or repurchased by the seller for a fixed price within a fixed period of time. A "pawn transaction" does not include the pledge to, or the purchase by, a pawnbroker of real or personal property from a customer followed by the sale or the leasing of that property back to the customer in the same or a related transaction.
State and local laws regulate pawnshops. Pawnshops may be required to be licensed and regulations often require certain standards of recordkeeping and pawnshop fees charges to be followed. Regulations may require a minimum age of persons seeking to pawn items and may prevent the offering of insurance for pawned items. Pawnshops may also be required to consult police reports of stolen items to verify ownership of pawned items. State statutes vary, but typically, if your stolen property is found in a pawnshop you may decide to purchase it back or obtain a court order to recover the property.
The following is an example of a state statute regulating pawnshops:
"At the time of making the pawn or purchase transaction, the pawnbroker shall enter on the pawn ticket a record of the following information which shall be typed or written in ink and in the English language:
- A clear and accurate description of the property, including model and serial number if indicated on the property.
- The name, residence address, and date of birth of the pledgor or seller.
- Date of the pawn or purchase transaction.
- Type of identification and the identification number accepted from pledgor or seller.
- Description of the pledgor including approximate height, sex, and race.
- Amount of cash advanced.
- The maturity date of the pawn transaction and the amount due.
- The monthly rate and pawn charges."
