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Arizona Pawn Shops: Practices and Procedures


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Arizona pawn shops operate under regulations developed by the state legislature and are designed, as in every state, to provide consumer protection and ensure fair lending practices. The pawnbroker is the individual that owns the business and he or she must also be licensed to be a pawnbroker within the state of Arizona. In addition the pawnbroker must also have a local business license.

When starting out the pawnbroker and his or her business must apply for licensure by the state and through the local sheriff of the county in which the business is located. The shop has to provide a credit report, a financial statement that is prepared by a certified public accountant, and a statement that shows that you have experience in the financial field. This information is all verified by the licensing agency of the state prior to approval. In addition, the owner must also provide a criminal background check and be eligible for other licenses such as a weapons broker license if they accept and sell firearms. Felony convictions, loss of a prior pawnbroker license, failure to provide correct reportable transactions or other violations of the law with regards to operating Arizona pawn shops will result in withdrawal of the license.

The Arizona pawnbroker, who must be a legal resident of the state, also has to follow very specific rules about conducting business. Everything from what must be on the pawnbroker's ticket through to the interest, fees and payment is controlled by the statutes in the Arizona State Legislature. The information posted in the pawn shop with regards to interest rates and payment options must be accurate and correct and this information is also included on the pawn ticket that is provided to the customer.

When a customer first brings an item into the pawn shop for a loan the pawn broker will examine the item and make an offer to the individual based on the value the pawn broker believes to be fair. The customer does not have to accept this offer and can negotiate or choose to use another pawn company. Once the price is agreed upon the pawnbroker lends the customer the money and retains the item. The broker then provides the customer with a pawn ticket. This ticket is like a claim for the item left.

According to the law Arizona pawn shops have to provide the ticket to the customer at the time of the loan and it has to have information about both the pawn broker and the client. This includes the physical description of the pledgor, the customer, as well as his or her identification information. The specific items must also be listed as well as the date of the transaction and the date of the maturity of the loan, which is typically 90 days. The ticket also has to state that the pledgor is not required to redeem the goods; rather they can simply leave the goods to forfeit them in lieu of the loan or create a new pawn transaction prior to the maturity date to continue the loan process. This involves paying off the interest on the current pawn loan before a new pawn ticket can be generated and the loan continued.

It is important for people using an Arizona pawn shop to realize that the date of the maturity of the pawn is the last date that they have the right to pay off the loan and reclaim their property or negotiate a new pawn transaction on the same items. Failure to complete either of these options automatically forfeits the property to the pawnbroker on the day after the maturity date. When this happens the pawnbroker is free to trade or sell the pledge property without any further actions or release required on the part of the customer.


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