How to Get the Best Deal When Pawning Gold

pawning gold: collection of gold rings.

Selling and buying gold is a huge business on a worldwide scale, and a huge proportion of that is a specialised market. Just as with any valuable commodity, there are bound to be several specialists operating in the trade of gold. But how do regular, non-experts break into the market to start pawning gold?

One of the quickest ways for lay people to be able to sell their gold is to pawn shops. For everyday people, pawn shops provide the easiest access to selling their gold, so we’ve put together this brief guide to make the process easier for you if you’re intending to sell your gold.

You Won’t be Paid the Full Price

There is a lot that needs to be done to your gold to be sold at the market value, such as smelting into ingots, and so the cost of this process means you won’t be paid the full price. You won’t be paid the global ‘market value’ for your gold that is listed officially, you’ll be offered less and that’s because of added costs after you sell it.

Gold dealers will have to pay the smelter up to 30 percent of the value of the metal in order to be able to refine it. This, in turn, means that pawnbrokers must offer even less to buy your gold in order for them to make a profit. So, don’t be surprised if a pawn shop offers you much less for your gold than you anticipated.

There is also another reason why you may be offered a lower price for your gold than the market value, and that’s due to the purity of the metal. Most of the gold items buyers deal with every day are not pure gold but an alloy of sorts, melded with other metals, and this brings the price down. The actual market price listed officially per weight is for pure gold only, already shaped into ingots, and for everyday items, you’ll be offered less than this.

Do Not Clean or Polish your Gold

Even though it may be tempting, it is actually worse to polish your gold before trying to sell it, believe it or not. Whilst it is okay to give the gold a quick wipe with a damp paper towel, under no circumstances should you try to polish it. This could result in some of the gold being rubbed off, which in turn will reduce the weight and lead to a lower valuation.

Remember, you’re already not going to get the full market price for your gold item, so it’s best to try and get the maximum price for the weight.

Compare the Best Prices

As with all markets, the price of gold will fluctuate depending on the supply and demand. You could go to one pawnbroker and ask for their price, and then ask at another reliable pawnshop in Melbourne or in your local area to compare it. Any pawn shop should be able to give you a free estimation, so there’s no harm in asking around before pawning gold.

Keep an eye on the market prices, and if you see a rise in the price, you can ask the broker if they can offer any more money – bearing in mind that the price you are offered will never match the globally listed price.

If you are unhappy to let your gold go at a price that you deem is too low, you could also hold onto it for a while longer to see if the price will go up after time. This tactic runs its own risk though, as the price could go down. So when pawning gold, think carefully!

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