What is a security loan and how does it work?

Many Chileans have heard at some point of pawn shops. But did you know that you can make efforts legally? That is precisely the issue that we are going to deal with, what it is and how a security loan works . Discover all about this method to get money quickly and safely.


What is a security loan and how does it work?

security loan

The so-called pledge is also known as a civil pledge loan, and it is a loan type, where money is granted, and instead a pledge is given as collateral, which today can be a jewel or some object of value. These negotiations are made legally in places authorized for this practice and as any business is closed with the signing of a document that guarantees that it can be recovered.


What is the process to be a beneficiary of the pledge loan?

pledge loan?

Two requirements must be met to be a beneficiary of the pledge credit. First of all you must be 18 years old with a valid identity card. In addition to having a garment of value of gold, silver or with some precious stones such as: diamond, rubies, emeralds, sapphires, among others.

Before going to the pawn shop, negotiation should take into account that the maximum amount of the credit does not exceed 60% of the value of the pledge, with a cap of $ 200,000 for jewelry and $ 100,000 for various objects. As expected for each of the garment or object.

At the time of initiating the loan process , the house that receives the commitment establishes the conditions. These are:

  • The credit is granted immediately, delivering the money in cash or through a bank transfer. It also has a period of 6 months to recover the garment or the object. In the case of spending that time and not claiming or paying interest, it becomes the property of the pawnshop.

  • The credits granted in the Alhajas area can be renewed once, for the same period. In case you do not have the money you can demand renewal, as long as you have paid the corresponding interest.

  • The credits granted for Miscellaneous Objects are not renewed.


Interest costs

The monthly interest rate of the loan is simple 2.5%, plus a 3.5% allowance and 1% insurance charged at the end of the loan. If you request a pledge for Alhajas, and you want to extend the term, the right to issue will be 4.5%, in addition to the interest rate. Both are calculated based on capital.

When rescuing the pledge, you only have to give the full amount of the credit granted. It can be done while the credit is in force. It is not necessary to wait for the expiration date.

To pay off a loan you must pay the amount of the loan, plus interest and rights generated until the date of cancellation.

It’s that easy to get a loan in Chile. However, we recommend that you do it legally. There are many clandestine places where efforts are made without any guarantee. While it is true that they can give up to 80% for the garment or object, it is also a reality that can run the irrigation not rescue it. As they do not deliver any documentation, you may not even see the person with whom you did the negotiation. It is better not to take risks and make transactions within the Law.