Pawn shops!

[Deleted]

Seems if you want the cash bad enough, you will find a way and Pawn shops are a growing business : www.smartmoney.com/borrow/debt-strategies/pawnshops-go-upscale-and-online-1304613626407/?link=SM_hp_ls4e

When Jim De Lisa's chain of six furniture stores went belly-up midrecession, the New Jersey father of five found himself in a fix. He was suddenly unemployed and broke, and his credit score, he says, was "in the crapper." Pushed to the edge by looming house and car payments, he did the unthinkable: He pawned his wife's $18,000 engagement ring. But no one ever saw him visit the pawnshop -- De Lisa hocked the 1.7-karat stunner over the Internet.

Is no industry immune to the inexorable forces of technology and gentrification? These days, even the pawn business is going upscale. Pawn merchants say the recessionary credit crunch is bringing in more middle-class clients along with small businesses seeking short-term loans to meet payroll. Jordan Tabach-Bank, CEO of Beverly Loan Co. in Beverly Hills ("Pawnshop to the Stars"), says he's seen a flood of doctors, lawyers and accountants hocking valuables to keep their kids in private school. There's a pawn store reality show airing on the History Channel and an iPhone app to help high-tech indigents locate the nearest pawnbroker. If the trend continues, hocking the family jewels may become as mainstream as applying for a credit card.

While pawnshops still charge eye-popping interest rates (up to 25 percent in some states), the once shady industry is rapidly going Disney. Pawn consultant Steve Krupnik says the sector's three publicly traded chains took cues from traditional retailers, deploying clean-cut employees, suburban locations and efficient technology. "They've forced the marginal operators to clean up," he adds.

Some of the nation's 13,000 pawnshops lure the (formerly) affluent with private appointments and house visits. In New York, EZ Pawn, an eight-store chain, is placing ads in local magazines. Pawn magnate Craig McCall, whose 13 Oregon and Arizona locations are in traditional shopping centers (two are in former Hollywood Video stores), decorates some shops with wainscoting and leather chairs at the loan desk: "There's no bars anywhere!" He even tried dressing his associates in shirts and ties, but they got too grubby lugging pawned lawn mowers and power tools. He settled for red polo shirts and khakis.

Perhaps the most intriguing new model is Jim De Lisa's lender: Pawngo.com, an online pawnbroker backed by $3.8 million in venture capital. Clients get an online estimate, FedEx their valuables to the company's Centennial, Colo., office park vault (Pawngo pays the shipping and insurance), and get a loan wired to their bank account within 24 hours. CEO Todd Hills says most of his clients wouldn't dream of frequenting a pawnshop -- they're hocking Cartier watches, Louis Vuitton bags, even a Picasso. His typical loan runs about $1,700, 17 times the $100 pawn-industry average.

The upside: Like all pawn loans, Pawngo transactions are never reported to the credit bureaus. If you default, all you've got to lose is your dearly departed mother's wedding ring. But the price for discretion is stiff; Pawngo's annual percentage rates range from 48 to 84 percent, depending on loan size. De Lisa says he paid more than $4,000 in interest on his 15-month loan worth less than $8,000. At least he's getting the ring back in time for his sixth wedding anniversary. And the experience has him considering new options: "I should open my own pawnshop!"

[Deleted]

It's interesting how people will stand in line in Vegas for a chance to visit the shop from Pawn Stars and maybe get on TV hawking their valuables, but there is such a stigma attached to the pawn shop in your home town.

[Deleted]

What surprises me is the number of people who take half the retail value for the item. I understand the pawn shop's view- it may stay on the shelf awhile, they're taking a risk they can't sell it, etc. But when they bring in someone who obviously knows the category (coins, autographs, guns, etc.) who says, "this item would probably get $X at auction", I'd be tempted to find myself an auction house and pay their 10 or 12% selling fee.

[Nazgul Girl]

I went to www.pawngo.com, but they must have problems, because their "website", which is very poor, states that they're "relaunching to improve the customer experience." Yep. To be sure. I've gone to pawnshops myself, to sell things (bullion years ago), not pawn them, and also to buy gold, diamonds and such. Much better prices on everything except the gold bullion, which follows market prices like all other sellers. I've been very happy with one pawnshop, altough the owner is nuts, and has real temper problems. He sells good stuff, though.

[2kids10horses]

tough,

I agree with you. If they wanted to sell, wouldn't they just sell it on ebay?

Edited to add:

In our small town, there have been 4 or 5 new pawn shops open in the past two years. Sign of the times.

[Deleted]

May 21, 2011 10:18:43 GMT -5 @toughtimes said:

Probably most are looking for a short-term loan, not to sell the item.

No, these are people who want to sell. Most of the people on Pawn Stars want to sell their items.

[Regis]

Not according to one of those quizzes they have before the commercial break on Pawn Stars. Apparently 60% of the people who bring items to a pawn store are there to pawn them. However, it does seem that 95% of the people they show on TV actually want to sell an item.

[8 Bit WWBG]

Whatever happened to undoubtedly-shotcaller? You think he is still doing the payday loan thing?

[2kids10horses]

I have a commercial piece of real estate in Atlanta, rented to a payday loan outfit. They are hugely successful. THey pay top dollar rent because they absolutely love their location.

[❤ mollymouser ❤]

Now I want to go visit and check out a pawn shop.

[2kids10horses]

I've been in a couple of the ones around here... I didn't see any really good deals. Not to say things might be different where you are.

I wanted to buy a chainsaw. They're frequently pawned. But, the shops wanted nearly as much as one would be new. I mean, within $10 on a $300 chainsaw. Sorry, I'll buy a new one.

[Deleted]

May 21, 2011 16:40:50 GMT -5 Regis said:

Not according to one of those quizzes they have before the commercial break on Pawn Stars. Apparently 60% of the people who bring items to a pawn store are there to pawn them. However, it does seem that 95% of the people they show on TV actually want to sell an item.

Makes sense. I'm in Vegas and I need quick cash isn't a circumstance I would be super excited to have on TV. Selling a collectible on TV seems like it would carry a lot less stigma - it's practically Antiques Roadshow.