Part Definitions

  1. Law
  2. Tennessee Code
  3. Banks and Financial Institutions
  4. Pawnbrokers
  5. Pawnbrokers Act of 1988
  6. Part Definitions

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As used in this part, unless the context otherwise requires:

  1. “Dealer and trader” means a person who holds a current certificate of registration with the department of revenue pursuant to title 67, chapter 6, part 6;
  2. “Maturity date of pawn transaction” means the date the pawn transaction is due to be paid, which date shall not be less than thirty (30) days after the date of the pawn transaction;
  3. “Net assets” means the book value of the current assets of a person or pawnbroker less its applicable liabilities as stated in this subdivision (3);
    1. “Applicable liabilities” includes trade or other accounts payable; accrued sales, income, or other taxes; accrued expenses and notes or other payables that are unsecured or secured in whole or in part by current assets. “Applicable liabilities” does not include liabilities secured by assets other than current assets;
    2. “Current assets” includes the investments made in cash, bank deposits, merchandise inventory, and loans due from customers excluding the pawnshop charge. “Current assets” do not include the investments made in fixed assets of real estate, furniture, fixtures, or equipment, investments made in stocks, bonds, or other securities or investments made in prepaid expenses or other general intangibles; and
    3. “Net assets” must be represented by a capital investment unencumbered by any liens or other encumbrances to be subject to the claims of general creditors. If the pawnshop is a corporation, the capital investment consists of common or preferred shares and capital or earned surplus, as those terms are defined by the Tennessee Business Corporation Act, compiled in title 48, chapters 11-27, as amended; if it is any other form of business entity, the capital investment consists of a substantial equivalent of that of a corporation and is determined by generally accepted accounting principles;
    1. “Pawn” or “pawn transaction” means either of the following transactions:
      1. “Buy-sell” agreement means any agreement whereby a pawnbroker agrees to hold a property (pledged goods) for a specified period of time not to be less than sixty (60) days to allow the seller the exclusive right to repurchase the property. A buy-sell agreement is not a loan of money, but shall still meet all recording procedures to law enforcement officers as with a pawn transaction; or
      2. “Loan of money” transaction means any loan on the security of pledged goods and being a written bailment of pledged goods as a security lien for the loan, for the cash advanced, interest and fees authorized by Acts 1995, ch. 186, redeemable on certain terms and with the implied power of sale on default;
    2. For purposes of all state and federal bankruptcy laws, a pledgor's interest in the pledgor's pledged goods during the pendency of a pawn transaction shall be deemed to be that of a right of redemption only;
  5. “Pawnbroker” means any person, partnership or corporation engaged in the business of lending money on the security of pledged goods; or engaged in the business of purchasing tangible personal property on condition that it may be redeemed and repurchased by the seller for a fixed price within a fixed period of time; or engaged in the business of advancing money to a customer in consideration for the customer surrendering possession of tangible personal property on an agreement by which the property may be returned to the customer's possession on repayment of the money advanced; and engaged in the business of selling new and used tangible personal property, whether unredeemed tangible personal property resulting from a pawn transaction, or acquired by a purchase of tangible personal property not acquired in a pawn transaction or purchased merchandise for resale from dealers and traders;
  6. “Pawnshop” means the location at which or premises in which a pawnbroker regularly conducts business;
  7. “Person” means any individual, corporation, joint venture, association or any other legal entity however organized;
  8. “Pledged goods” means tangible personal property, other than choses in action, securities, printed evidences of indebtedness or title documents, which tangible personal property is purchased by, deposited with, or otherwise actually delivered into the possession of a pawnbroker in connection with a pawn transaction, and includes “pawn” or “pledged property” or similar words; and
  9. “Pledgor” means the pawn loan customer of the pawnbroker, entering into a pawn transaction with the pawnbroker.


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