Should I Sell My Diamond Ring To a Pawnshop

Should I sell My Diamond Ring or Jewelry to A Pawnshop?

In This installment of The Diamocycle Dispatch, we tackle the problem of whether to sell your diamond ring to a pawn shop near you. While this is a highly personal choice, we make sense of the pros and cons and give you a few better options to get more money. Our legacy in diamonds began in 1857, over 150 years ago. We take pride in sharing the advice we would give a valued customer. 

What is the History of Pawnshops

Pawnshops have a long and rich history dating back thousands of years. The concept of pawnbroking can be traced back to ancient China, where moneylenders would give loans to peasants using their possessions, such as farm animals or tools, as collateral. Similar practices were observed in ancient Greece and Rome, where lenders would accept clothing, jewelry, and even slaves as collateral.

The modern pawnshop as we know it today originated in 15th-century Italy, where the Medici family established a network of pawnshops to provide credit to the poor. From Italy, the concept spread throughout Europe, with pawnshops becoming an important source of credit for small business owners and individuals.

Pawnshops played a significant role in the development of the American economy. In the early colonial period, pawnshops were established in major cities such as New York, Philadelphia, and Boston, and were used by settlers as a means of obtaining credit to start businesses and buy land. During the Great Depression, pawnshops became more popular than ever, with many struggling Americans turning to them as a source of quick cash.

Today, pawnshops remain an important part of the economy, providing credit to individuals who may need access to traditional banking services. Pawnshops also offer a unique shopping experience, with customers able to find various items at discounted prices. However, the industry has faced criticism for its high-interest rates and the potential for the exploitation of vulnerable individuals. Despite this, pawnshops continue to be an important part of the global financial system.

How Does Pawning Your Jewelry Work?

Pawning your jewelry is a straightforward process that involves using your jewelry as collateral to obtain a short-term loan from a pawnshop. Here’s how it works:

  1. Bring your jewelry to a pawnshop: You can take your jewelry to a pawnshop and present it to the pawnbroker. The pawnbroker will examine the jewelry to determine its value.
  2. Agree on a loan amount: The pawnbroker will offer you a loan amount based on the value of the jewelry. This amount will typically be a percentage of the jewelry’s appraised value. If you accept the loan amount, you will need to sign a loan agreement with the pawnshop.
  3. Receive your loan: After signing the loan agreement, you will receive your loan in cash or by check. The pawnshop will hold your jewelry as collateral until you repay the loan.
  4. Repay the loan: You will have a specified period to repay the loan, usually around 30 days. You can repay the loan in cash, and the pawnshop will return your jewelry.
  5. Redeem your jewelry: If you cannot repay the loan, the pawnshop will keep and sell your jewelry to recover their money. However, suppose you’re able to repay the loan. In that case, you can redeem your jewelry by paying off the loan plus any interest or fees.

It’s important to note that if you don’t repay the loan, the pawnshop will keep your jewelry and sell it to recover their money. Additionally, the loan amount may be less than the appraised value of the jewelry, so read the loan agreement carefully before agreeing to a loan.

Is Pawning Jewelry Worth It? What Scams to avoid

Whether pawning jewelry is worth depends on your financial situation and needs. Pawning your jewelry can provide a quick source of cash in an emergency. Still, you need to carefully consider the loan terms and the value of the jewelry before proceeding. Here are some factors to consider:


  • It’s a quick way to get cash without a credit check or income verification.
  • You can use items you own as collateral rather than taking on new debt.
  • You can get your jewelry back if you pay off the loan within the agreed-upon time period.


  • The interest rates on pawnshop loans can be very high, which can add up quickly if you’re unable to repay the loan on time.
  • You may not get the full appraised value of your jewelry, so you should carefully consider whether the loan amount is worth it.
  • If you can’t repay the loan, you’ll lose your jewelry.

To avoid scams when pawning jewelry, be sure to:

  • Only work with reputable pawnshops that are licensed and regulated by your state or local government.
  • Read the loan agreement carefully before signing it and ensure you understand the loan terms, including the interest rate and any fees.
  • Be wary of pawnshops that offer extremely low-interest rates or that claim to be able to appraise your jewelry over the phone.
  • Avoid pawnshops that pressure you into accepting a loan or that don’t provide transparent information about their policies and procedures.
  • Keep a copy of the loan agreement and ensure you understand what will happen if you can’t repay the loan.

How Much Can You Pawn Your Jewelry For?

The amount you can pawn your jewelry for depends on several factors, including the type of jewelry, its condition, and the current market value. In general, pawnshops will offer you a loan amount that is a percentage of the appraised value of the jewelry.

For example, suppose your jewelry is appraised at $1,000. In that case, the pawnshop may offer you a loan of $500 to $700, depending on their policies and procedures. It’s important to remember that the loan amount will be less than the appraised value of the jewelry and that interest and fees will be added to the loan amount.

The percentage of the appraised value that a pawnshop is willing to lend can vary, but it’s typically between 25% and 60%. This means that if your jewelry is appraised at $1,000, you can expect to receive a loan of between $250 and $600.

It’s important to note that the loan amount offered by a pawnshop will also depend on the demand for the type of jewelry you’re pawning. High-demand items, such as gold and diamond jewelry, may fetch a higher loan amount than other types of jewelry.

To get the best loan amount for your jewelry, shopping around and comparing offers from different pawnshops is a good idea. Also, read the loan agreement carefully before agreeing to a loan, and make sure you understand the interest rate, fees, and repayment terms.

Alternatives To Pawnshops For Personal Cash Needs

If you require quick cash and don’t want to pawn your jewelry, there are several alternatives to pawnshops that you may want to consider:

Personal loans: You can apply for a loan from a bank, credit union, or online lender. Personal loans typically have lower interest rates than pawnshop loans and can be used for various purposes.

Credit cards: If you have a credit card, you can use it to get a cash advance. Keep in mind that cash advances usually come with high-interest rates and fees.

Friends and family: If you have friends or family members willing and able to lend you money, this may be a good option. Remember to repay the loan on time to avoid damaging your relationships.

Selling your jewelry: You can sell it outright to avoid pawning your jewelry. You can sell your jewelry to a pawnshop, a jewelry store, or online through websites like eBay or Craigslist.

Gig work: You can also consider doing gig work, such as driving for a ride-sharing service or delivering food, to earn extra cash quickly.

When considering alternatives to pawnshops, be sure to compare each option’s interest rates, fees, and repayment terms to make an informed decision.

Online Alternative to Pawnshops in 2023

There are several online marketplaces that you can use to sell your diamond ring that may offer better prices than a pawnshop. Here are a few options:

Worthy: Worthy is an online auction platform that specializes in selling jewelry. For example, you can sell your diamond ring through Worthy, and they’ll provide you with a free appraisal and help you set a reserve price for your ring. Once your ring is sold, you’ll receive payment via bank transfer or PayPal.

Pros: Relatively quick process from multiple wholesale buyers.

Cons: Selling to a wholesale buyer minus a transaction fee. 2 buyers away from a retail buyer. Likey 20-40% of the retail price. 

WP Diamonds: WP Diamonds is an online buyer of diamonds, jewelry, and luxury watches. You can sell your diamond ring to WP Diamonds. They’ll provide you with a free valuation and a guaranteed offer. They also offer free and insured shipping.

Pros: Speedy, reliable cash price from a wholesale buyer.

Cons: A significant loss will be incurred. Likey 20-40% of the retail price.

Diamocycle: is an online marketplace for buying and selling diamond rings and other jewelry. You can sell your diamond ring through their website, and we are here to create a secure transaction and advise you on the price. 

Pros: A secure process to find a retail buyer.

Cons: It takes much longer to find a retail buyer who may pay up to two times more than a wholesale buyer. Likely 50-80% of the retail price

Before selling your diamond ring online, be sure to understand the benefits of each selling method and the cons of each technique. 

You should also get a professional appraisal of your diamond ring for an accurate value before selling it. Diamocycle is here to help you through every step and create a secure selling platform that provides the highest market price for your pre-owned diamond jewelry.