Legal Question in Business Law in Minnesota

Cash and Pawn receipt

My boyfriend and I pawned an XBox 360 at the pawn shop. We had not paid on it for a couple and months and went to pay on it last month. The salesman said that we needed only to pay the 59.00 to keep the xbox on hold. He gave us a receipt after we paid the 59.00. He remaining balance was only 317.00 and it would remain that way for 30 days. We went in today, before the 30 day period was up to pay the remaining 317.00. A different salesperson said that we owe 471.00. I was wondering if you could tell me how that happened if we came in before the 30 to pay the remaining balance. They are saying it is owed for the other two months that they held the xbox. If that is the case why didn't the first salesman say something and why would they give us a receipt that had a remaining balance of 317.00? Thank you for your help.


Asked on 1/05/07, 3:01 pm

1 Answer from Attorneys
John Jesperson Minnesota Lawyers - Jesperson Law Offices

Re: Cash and Pawn receipt

Thank you for your question.

You should carefully review the pawn ticket and your pawn agreement. The pawn ticket should provide a payment schedule, that specifies the payoff amount after certain periods of time have expired.

At this rate, however, whether it is $317 or $471, the cost to redeem the item may be equal to the cost of a new system. The effective interest rate on pawn "loans" is so high that, after a period of several months, it is almost never cost effective to pay off the amount due. The whole process is, in fact, designed to discourage you from repurchasing the item. That's the nature of the business.

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Answered on 1/05/07, 4:13 pm


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