Skip to Content

How Much Does A Pawn Shop Pay For A Diamond Ring?

How Much Does A Pawn Shop Pay For A Diamond Ring?

Whether you’ve ended your marriage or run into a difficult financial situation or you just want to upgrade from your existing diamond to a new, more beautiful one, you may find yourself in need of selling your diamond ring. 

From the available options out there, a pawn shop might sound like a good place to sell your diamond ring. This begs the question: How much does a pawn shop pay for a diamond ring?

While pawn shops are a good place to sell your musical instrument or a used TV, it’s usually not a good idea to sell a diamond ring to them. This is due to their business model. You won’t get back anything near the price you originally paid for your diamond ring.

In this article, we’ve explained this in more detail as well as some better alternatives to selling your diamond ring. Without further ado, let’s dive in.

How Much Can You Sell Your Diamond Ring For?

Let’s assume that the diamond ring costs 100 (currency isn’t relevant now, just relative values matter). A 25% profit percentage means the price you paid was 125. Let’s assume that the prices of diamonds have risen 10% since the diamond was purchased. 

In theory, you’re only losing 12% at this point. 125 (which is the price you paid) minus 110 (the price you get for the gemstone) equals 15 – that is your total loss divided by the original price paid, which equals 12%.

But here’s where it becomes interesting – whom do you turn to sell your diamond at the current market price? The answer is nobody.

Related Read: Diamond Price List: How Much Is A 0.1 To 40 Carat Diamond Worth?

Where To Sell Diamonds?

Let’s take a look at where can you sell your diamond ring:

Jewelry Stores

Supposing that you walk into a jewelry store similar to the one you bought your diamond ring in. When they originally paid 100 units for that diamond, they probably had that stone on consignment. 

This means that the true cost of that gemstone was significantly less than the 100 units the jewelry store paid for it on paper. If they purchase your diamond, they do it for cheap.

For the jewelry store to make an investment in a diamond, it will have to justify it by purchasing at a cheap price. In addition, relationships between buyers and suppliers in this business are very important.

For a store to use its own money to purchase a diamond from you instead of using it as an opportunity to strengthen the relationship with the supplier means that they would need to justify that decision through purchasing your diamond for cheap.

Furthermore, almost anyone in the business who is faced with a private seller recognizes that this is a perfect opportunity to purchase well below the market price.

Overall, it’s highly unlikely.

Unless the diamond which is being offered is extremely rare, there’s simply no reason why the jewelry store would be compelled to purchase your diamond at the market price when they can purchase an identical diamond at the same price from any one of the numerous wholesalers.

Direct Consumers

You can always try to fo directly to the consumers. Craigslist has its own risks. You can try selling your diamond on eBay or other similar sites. However, no consumer is willing to pay you the same price you paid when they can just go and buy the same diamond from a jewelry store.

Learn More: Is Selling Diamonds Legal?

Pawn Shops

If you take your diamond to a pawn shop, expect to be shocked as their selling prices are already well below the market. That’s why their costs must be very low to justify their low prices.

Pawn Shop Business Model

Pawnshops have been around for thousands of years and their business model dates back to Ancient Greece.

The pawnshop business model is pretty simple. You walk into the pawnshop and give something you own to the pawnbroker. He then gives you a loan, using the item you’ve given as collateral for this loan.

This process is called pawning the item. After you pay back the loan plus interest that the pawnshop charges, you get back the item you’ve provided as collateral, and with that the process is concluded.

However, if you don’t repay the loan, the pawnshop keeps the item you pawned and sells it to recoup the loss.

Most of the time, the loan that you receive from a pawnshop is significantly less than the item you’re pawning is worth. For example, if you decide to pawn a watch with a used value of $1200, the pawnshop might offer you a loan of $300 to $700.

Pawnshop loans are typically short-term, with most made out with a repayment deadline of 1 to 6 months.

On the other hand, you can choose to sell your item to the pawnshop. In this case, the pawnshop will pay a flat fee for your item. This fee is usually a small fraction of the item’s true value, as the pawnshop needs to make a profit when selling the item.

Is It Worth To Sell A Diamond Ring To A Pawnshop?

Selling your diamond ring to a pawn shop isn’t a good idea. If you want to sell your diamond ring to a pawn shop, expect to receive a small fraction of what the diamond ring is actually worth as payment.

People buy stuff at pawn shops to get good deals on pre-owned items. Nobody expects to walk into a pawn shop and pay the market price for something. Pawnshops typically attract customers due to their prices being well below the market average.

This means that pawnshops need to keep their costs low or rely on making money through loans.

As an example, let’s take a pawnshop loan. Once interest and fees are calculated, an ordinary pawnshop loan can easily go to more than 200% APR. this means that the pawnshop gets a high return on investment just by loaning out money using customers’ items as collateral.

A pawn shop needs to purchase an item at a very low price in order to get a comparable return on investment by selling the item. It’s not only the profit from the sale, they also need to pay employee salaries, rent, utility bills, and other expenses. 

There are other factors as well that make a pawn shop a not-so-good place to sell your diamond ring. The first factor is that most pawnshop owners aren’t diamond experts. As such, if you have a large, colorless diamond, they might not be able to accurately appraise its value.

The second thing is that the primary resale of a pawn shop is local. They will usually try to sell your ring locally or just pass it to a local jewelry store. Since this is a smaller market than online, it requires a lower selling price.

The third factor is negotiation. Pawnshop owners and employees are all experts at finding tiny, imperceptible flaws in items, allowing them to offer you a lower price. So if you aren’t an experienced negotiator, you’ll most likely end up getting a small fraction of what your diamond ring is truly worth.

Due to these factors, the average consumer gets about 30% to 60% of what their items are worth when they sell to the pawnshop.

Alternatives To Selling A Diamond Ring At A Pawn Shop

Unless you have a particularly rare gemstone for whatever reason, you will always lose money if you sell a diamond ring.

This is simply the reality of the jewelry industry. Even if the diamond price has risen 10% since you purchased your diamond ring, the market price for your diamond is still lower than what you paid.

There’s also a fact that no jewelry store will buy a pre-owned diamond ring at the market price. They can just buy a new diamond and setting from a supplier at the same price. 

The end result of this is that no matter how and where you want to sell your diamond ring, you just can’t receive its market value and you will always lose some amount of money compared to what you originally paid.

However, there are several options for selling a diamond ring. Some of these will lead you to lose less money than others. 

The first is selling the diamond privately on Craigslist, eBay, or another platform. This is probably going to regain you the largest percentage of your diamond’s original price. However, this can be a slow process, and finding someone to buy a used diamond ring isn’t that easy.

The second thing is to sell your diamond ring to a local jewelry store. Jewelry stores can’t offer you much though as they have suppliers that can sell them diamonds at very good prices. In most cases, you’ll be offered a price well below the market price.

The third option is to sell it to a company that specializes in purchasing pre-owned diamonds. These companies will have a diamond inspected by a lab such as GIA and offer a price that is based on a diamond’s quality and value.

Here’s What To Do If You Must Sell At Pawn Shop

If you’re dealing with a financial emergency and need to sell your diamond ring as quickly as you can, a pawn shop might just be the only viable solution.

If that’s the case, it’s crucial to know how the process works and the most common hazards that can affect you as a buyer.

Firstly, make sure you know the true cost of the loan if you’re pawning your diamond ring. Pawnshop loans are made for the short term and can be very expensive if you’re slow to pay because of the extra fees and high interest rates.

You should double-check the contract, including the fine print. If you aren’t sure about something in the agreement, be sure it’s explained before you agree to anything.

If you want to sell your diamond ring outright, visit several pawn shops to see what they can offer for it. You may find that some offer higher prices than others. This is because of the better understanding of the diamond market and the ability to sell your diamond ring.

Before you sell your diamond ring to a pawn shop, be sure to check the reviews of the particular shop by using Google to see what other customers think.

You should visit jewelry stores as well. Even though local jewelry stores won’t offer the market price for your diamond ring, they will, in most cases, offer you more than a pawn shop.

Negotiate with the pawnshop owner or employee before you accept any offer as you may get a better price for your diamond ring. Pawnshop staff usually offer a low price at the beginning, hoping they will take advantage of customers that aren’t ready to negotiate.

Be prepared to walk away. Despite the fact that many pawn shops are fair businesses, some will take advantage of customers. If you feel that you aren’t being given a fair deal, be ready to walk away from the deal.

In the end, selling to a pawn shop is often a bad idea when you have much better alternatives available. But if you must sell at a pawn shop, the tips above can help you get a slightly better price.


Let us break it down for you if you’re still confused about the question: “how much does a pawn shop pay for a diamond ring?”.

Pawnshops will very rarely offer you a good deal for your diamond ring. Most of them will pay a small fraction of what your diamond ring is truly worth. As such, we wouldn’t recommend you to sell your diamond ring or any other diamond jewelry to a pawn shop.

Instead, try selling your diamond ring to a local jewelry store as they can offer you a much better price. You can also try selling it on eBay or Craigslist but finding a customer there can sometimes be hard to achieve.

See Also: How Much Are Tiny Diamonds Worth?