With the downturn of the economy, a lot of people needing fast cash have opted for a different kind of loan-broker. Pawn shop business has increased dramatically in many states, and it isn’t just lower income people who are using their services. The typical customer has been in the income range of around $29,000, but pawn brokers around the country are seeing a rise in new clients who are middle to the upper middle class. Even the elderly are starting to use pawn brokers more frequently; pawning and selling family heirlooms and jewelry.

Where most shops usually deal in jewelry, electronics, tools, guns and musical instruments, some are also buying gold and silver. The huge rise in gold prices has a lot of people pawning and selling their gold or silver jewelry for quick cash. Some pawn brokers seeing the type of people who have become the newest clients are catering to that crowd. Some stores are geared toward the more affluent crowd. Their inventory includes items like diamond rings (in multiple carats), Picasso paintings, Rolexes, fur coats and Ducati racing bikes; these places make loans for hundreds of thousands of dollars, even into the millions. They aren’t your typical kind of pawn shop, but they do exist.  

The process isn’t difficult. A customer will take their merchandise into the pawn broker, who then examines it and decides if it is worth loaning money on. If it is, and you can both agree on a price, you get your money, and they will hold your item for thirty days. At the end of your loan period you must pay for the loan, plus interest, pay the interest only and extend the loan period for thirty more days, or lose your stuff. Some brokers make loans for thirty days. Some do it for sixty days, and some will make the loan for longer, depending on the amount borrowed.

There are many factors that influence the broker’s decision to loan money on things; the age and condition of the item and the ability to re-sell that type of merchandise have a lot of bearings. You can also choose to outright sell the item to them and not worry about repaying the loan. Pawn shops deal in a multitude of merchandise, but some places won’t take certain items like musical instruments, cars or guns; other shops may want those kinds of things. It would be to your benefit to go visit a few in your area, before you’re in a crunch for the cash. Look at the items they carry and talk to the staff about what they loan money on. 

Some people think of pawn shops as seedy, back alley types, that are only used by people of the criminal element, and that simply isn’t true. Pawn Brokers are also thought by some to deal in stolen goods; actually, most (pawn) brokers work with their local law enforcement officers to cut down on receiving stolen property. Some city’s or states may even require the broker to check in with local law enforcement on a weekly or bi-weekly basis to be given updates about stolen property to watch for. Pawn shops are regulated by state and federal laws, and most have interest rates that are actually lower than the typical payday loan store.

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