Pawn service charge

Definition

The monthly charge a pawnbroker may add to a loan, capped by the state's own statute.

Why It Matters

It is the price of the loan and the state writes the ceiling. Florida allows any amount so long as the total, including the interest component, does not exceed twenty-five percent of the amount financed for each thirty-day period, with a minimum of five dollars. That structure makes small loans disproportionately profitable and large ones thin, which is why the average loan size decides the economics more than the loan count does. Check the charge the shop actually applies against the ceiling, because shops routinely charge less than they may.