Do Pawnshops Require Vehicle Impoundment for Auto Loans?

[VanCamila]

Whether a pawnshop requires vehicle impoundment for an auto loan depends on the situation. There are two scenarios where pawnshops offer auto loans without impounding the vehicle: If you temporarily don't need the car, you can choose to impound it: The interest rate will be relatively lower, and the loan amount will also be higher. If you need to use the car, you can choose not to impound it: This way, you can both borrow money and use the car without interruption. However, not impounding the vehicle usually requires the installation of a GPS. Differences between impounding and not impounding the vehicle at a pawnshop: If the borrower chooses not to impound the vehicle: The owner can continue using the car for travel, enjoying great convenience in transportation. The pawnshop assumes the loan risk, and to mitigate this risk, the pawnshop will implement preventive measures in the loan pricing. For those who choose not to impound the vehicle, the loan fees will generally be higher than for vehicle impoundment loans. If the borrower chooses to impound the vehicle: The pawnshop will then store the vehicle in a specialized garage under professional supervision until the owner redeems it.