An advantage of a pawn shop loan is that it is easy. For example, the borrower simply needs to offer an item of value that they can use for collateral and fill out some paperwork. The pawn shop is then going to give you a receipt that has the terms of the loan on it. If the borrower fails to pay the loan in time. they lose the item of value, fee from any credit score repercussions.
These types of in house loans don't rely on your credit history. The loan is secured completely by the collateral that you provide to the pawn shop. Therefore, the lender is not really concerned with whether you default on the loan or not.
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