Boston pawn shopWith the struggling economy, a Boston pawn shop owner says they have seen an increase in new faces coming into their store in the past year or so.  Some people are trying to stretch their dollar a little further while others have lost their job, a pawn shop is no longer considered for cheap people only.

The state of the economy has taken its toll on everybody, not just the lower and middle class, but the upper class as well.  Pawn shop owners report people driving up in Mercedes and BMWs and pawning valuable diamond rings in order to make the payments on their expensive cars.  Others are selling gold jewelry to make mortgage payments.

Pawn shops deal in both collateral loans and sales with both types of pawn deals holding strong in the past several months even in this economic climate.  People are looking to both sell their valuables for quick cash and are also looking for gently used products for their home and family.

A person can bring in a valuable item such as a diamond ring, electric guitar, power tool or laptop computer and a pawnbroker will loan the customer approximately 50% of what they think they could sell it for.  The customer then has two choices to make: the first choice would be to take the money and pay their bills and forget about the valuable item in which case the pawnbroker would then sell the valuable item on their sales floor to someone who is looking for a gently used item.  The second choice would be to take the money as a loan with the valuable as collateral and in 30 days come back with the loan money plus approximately 3 to 5% interest, pay the money back and receive their valuable in return.

Many people, from all sides of the “tracks” and from both blue-collar and white-collar workers, are turning to pawn shops in these economic hard times to either receive money for goods or to purchase gently used items at an incredible savings.