When you make the decision to sell gold jewelry for some extra cash, of course you are aware of the different options that I have presented here. But let’s take a closer look at how the pawn shops buy scrap or unwanted gold jewelry.
The first thing that you should realize is the fact that the pawn shop is simply providing a service. It’s typically not the main reason why they are in business. The purpose of pawn shops is to loan people money and to hold some of their property as collateral so they can be sure that the borrower will come back to pay off the loan. And if they don’t come back to pay back the loan, then the pawn shop keeps the collateral and sells it to get his money back.
That’s not the typical transaction that takes place on the television show “Pawn Stars”, but it is the reality of how these types of shops work.
So how does the transaction process of selling gold jewelry to a pawn shop work? You bring your unwanted or scrap gold jewelry into the shop to have it evaluated. You jewelry will be examined, tested for purity and weight. Unethical shop owners will fudge a little when your jewelry is weighed so make sure that you have it weighed at more than one place. After you gold is weighed and tested then you will be made an offer.
The offer that you get will be based on the spot price of gold. But what is the spot price of gold? You can find it here just to the right of this article. But keep this in mind; your jewelry is not pure gold. The spot price is based on pure gold, and they are just not going to offer 100% of spot price. No gold buyer can offer 100% of spot price, because that is how much they will get when it is sold. That’s a concept that many people just can’t grasp. Any type of buyer has costs and expenses to cover, so they must leave a little profit margin so they can stay in business.