A pawn is a pledge of personal property to a pawnbroker as collateral for a loan. If the borrower repays the loan within a specified amount of time, the borrower may redeem the item, but if the borrower does not repay the loan within a specified amount of time, the pawnbroker has a right to sell the goods deposited to them. Generally, pawnbrokers only accept items whose value significantly exceeds that of the loan so they can not only cover the cost of the loan if the borrower defaults, but also turn a profit.
Pawn can also be used a verb to mean the act of making such a pledge in return for a loan.
[Last updated in July of 2020 by the Wex Definitions Team]