Less than one percent of all loans are identified as stolen goods. Pawnbrokers work closely with local law enforcement. A customer must provide positive identification to show evidence of the transaction. This information can then be presented to the police department, therefore decreasing the likelihood that a thief would bring stolen merchandise to a pawnshop. It is not in the interests of the pawnbroker to accept potentially stolen merchandise because the police can seize the merchandise and the pawnshop owner loses the collateral and the loaned money.
Pawnshops are registered firearms dealers with permanent places of business.
As registered licensed dealers, pawnshops comply with the statutory waiting periods and background checks. Federal firearms regulations require an individual to be 21 years of age to purchase a handgun and 18 years of age to purchase a long gun. Pawnshop rates can be high, however, all lenders charge rates commensurate with risk, size and duration of the loan, collateral offered, and recourse. Pawnshop loans are small dollar, high risk, short duration loans. The item stands as the sole collateral offering no other recourse.