For full functionality on this website it is necessary for a browser that supports JavaScript to be used. Please upgrade to browser that supports JavaScript to use all the features of this website.

Click here to find out more

This website uses cookies. We use cookies to give you the best experience. If you continue using our website, we will assume that you are happy to receive all cookies on this website. Cookie Policy

Guide to Pawnbroking Interest – How Pay Down Works

Published: 10 May 2019

The key to a successful pawn loan is to understand how they work. If you’ve got the basics down, getting to grips with how pawn loan interest works and the various ways you are able to pay back what is owed should be next on your list. Read on for H&T’s simple guide to pawnbroking interest, how to pay back your loan, and how Pay Down works.

How long do I have to pay off my pawn loan?

When you take out a pawn loan with us here at H&T Pawnbrokers, you are agreeing to a 6-month loan term. This means that you have to pay the full loan amount plus the agreed interest on, or at some point before, the 6-month cut-off date.

How much interest will I be charged?

The amount of interest applied is dependent on the amount you are borrowing. For instance, a loan amount of £1-£500 will have 9.99% monthly interest applied. The loan amount is dependent on the value of the item(s) you wish to pawn. The interest rates reduce for higher amounts borrowed:


Loan Amount

Monthly Interest



£501 - £2,500


£2,501 - £5,000


£5,001 - £7,500


£7,501 - £10,000


£10,001 - £15,000


£15,001 - £50,000


£50,000 - £100,000



Do I have to pay it all at once?

You are welcome to pay in as many instalments as you’d like, or you can pay it all off at the same time – it’s entirely up to you. Many of our customers find that paying off the loan little and often whenever they are paid is the easiest method. What works best for you will depend on your personal circumstances and we’d be happy to discuss this with you during the application. You will not be charged more, nor will any additional fees applied for paying in instalments.

Can I pay the loan off early?

Yes, you can. You’re welcome to pay off your loan in full at any point during the loan term, up until the final day itself. No matter when the loan is paid in full, you’ll receive your item back straight away – either in person if you have paid in-store or via insured courier if you have paid online.

If I pay my pawn loan early, will I pay less?

Yes, you will! As interest is charged on a monthly basis, you can save money on the final loan amount by paying it off early. For example:

Pawn loan amount = £100
Interest at 9.99% = £9.99 per month

Over 6 months, the total to pay back would be £159.94. This is the original £100 loan, plus 6x the monthly interest payment of £9.99.

If you decided to pay this loan back in full within 3 months, you would not have to pay the interest for the other 3 months. Paying back the full amount in 3 months would mean a total loan payment of £129.97, and a saving of £29.97 in interest.

The full amount you’ll have to pay each month to pay off the loan will be made clear to you at the time of application, and you’re always welcome to check on the status of your loan at any point during the term.

What is Pay Down?

Pay Down is a way to reduce the amount of interest you have to pay overall by paying off the interest, plus a little extra on a weekly or monthly basis. This can be a useful way to manage your loan over a longer period of time, so that it’s ultimately easier to fit into your everyday expenses. To explain how this works, we’ll use the same £100 pawn loan example as above:
Pawn loan amount = £100
Interest at 9.99% = £9.99 per month
Payment made at the end of month 1 = £9.99 interest plus £10
Now the amount owed is £90, which would still have an interest rate of 9.99%, but the new total reduces the interest amount owed by £1. Rather than stay with the original plan, we can now renew the loan contract for a £90 loan in order for you to get that saving.
New pawn loan amount = £90
Interest at 9.99% = £8.99
You can continue doing this over the loan term to lower the amount you’ll have to pay in total. It’s a great way to keep track of your payments and ensure you make the loan work for you, and not the other way around.

Any questions? Our knowledgeable and friendly team are happy to help – call us on 0800 838 973, use our online contact form, or visit us in-store for an informal chat. You can find your nearest H&T branch here.