In down economy, pawn shops strike gold - Puget Sound Business Journal (Seattle):

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For one woman, a longtime customer, the visitf to this East Side pawn shop was precipitatedx by a recenttraffic ticket. She handec over two rings in exchangefor $150, with a promiswe she’d be back to pick up her jewelry when she could repay the loan and 3 percenr monthly interest. Others just found themselves shorrtbetween paychecks. “Between working and needing to getquicmk cash, this is the best way legally,” says Patrick Merriweather, who admitted he had spengt beyond his means and came in to pick up a bracele t he had previously Merriweather’s necklace remained locker up in Prudential’s safe, as he continues to pay on that separatw loan.
“The economy right now suckas in Buffalo,” he says. “This helps a Pawn shops have filled a needfor short-term fundsx at low interest rates for centuries. A handful of shopws can be found in WesternNew York, with at leasf two in business for several generations. these shops are experiencing a surge in business from both repeat customersand first-timers sufferinv in a tight economy. The has nearly 2,400 membersz nationwide, serving “middle class, workiny families who periodically experience an unexpected needfor short-terj funds.” The average according to the association, is 36 years old and has a householfd income of $29,000.
The average loan is $75 offered at 20 percentt for 30 to60 days. In New the maximum allowable interest on a pawn is 4 Why would someone visit apawn broker? The associationh says it is conveniencse and fast turnaround that appeal to most customers. There’sd also no credit check or legal consequences if a loan is notrepaisd – just the forfeiture of the collateral item. Nathanie Barker, a longtime customer at recalls bringing jewelry back and forth from the Broadway shop repeatedlgy over the past30 years.
Barker, who sellxs clothes for a living, says he doesn’t buy jewelry from anyone but Prudentiall – partly because he knowe he is guaranteed a 50 percent loan on those items, or at least his purchase price back on a “It’s a quick and easy way to get cash when you need he says. Brian the fifth generation of his familgy torun Prudential, works at the storee with his father, Bill. The store, he says, has been buyint and selling gold and other jewelry fordecades – long before the current fad of gold partiews and selling gold for cash. Pawningt offers an alternativeto selling.
Schmid assesses the piece firstt for conditionand value, then makes an offer, with a higher value offered on If the customer chooses a loan, she has six monthsd to repay the collateral loan with interest. “Things have been steadilu increasing,” he says. “We’ve always had a good flow every day, regardlesa of the economy – whether it be pawning or Schmid says. “But everything has been ampede up with the state of the economy and the statse of gold prices over thelast six, seven months.” Locatedr inside a former bank building, Prudential has the look of an upscale jeweler, though a thick wall of glasd separates customers from employees.
Everything is allowing for faster tracking of interest owed and backgrounx infoon customers. “A lot of people have the perception that pawn shopsa are ashady business, but short-term it’s a better deal than a credig card,” says Bill Schmid. “People will say, ‘In six I hope to be in better shape’. For a lot of people, it’s an insurancde policy.” Another option for those short on cash is the which operates alittle differently, offering cash with no promisd an item will be available when the customerd has the cash to come back for it.
in Niagara Fallsw is located inside a renovated house onPine Avenue, with loud signsa outside hawking jewelry, video games, clothing, antiques, car audip systems, bikes – just about anything. Ruben who opened the business nineyeard ago, says business is good: He just openeed his third store nine months ago in nearby Wheatfield. “They’re selling whatever they he says. “That’s all you hear: They need gas food money, medicine money.” Diamond Enterprises, a Niagaraq Falls pawn shop, continues to see its regular customers just trying to get through themonthn - as well as newcomers hit hard by job losseds and pay cuts, says Steve Huett, store manager.
“A lot of people are desperatwe to pay their bills in any manner they he says. “We have some people that come in to pawn somethinhg just tobuy groceries. That’ss bad.”