In down economy, pawn shops strike gold - Triangle Business Journal:

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For one woman, a longtime customer, the visitg to this East Side pawn shop was precipitate by a recenttraffic ticket. She handede over two rings in exchange for with apromise she’d be back to pick up her jewelrt when she could repay the loan and 3 percenf monthly interest. Others just found themselvex shortbetween paychecks. “Between working and needingt to getquick cash, this is the best way legally,” says Patrick Merriweather, who admitted he had spent beyonx his means and came in to pick up a braceleyt he had previously Merriweather’s necklace remained locked up in Prudential’s as he continues to pay on that separate loan.
“The economy right now sucka in Buffalo,” he says. “This helps a lot.” Pawn shops have fillesd a needfor short-term funds at low interest ratee for centuries. A handfu l of shops can be found in Western New with at least two in businesas forseveral generations. Nationwide, these shope are experiencing a surgse in business from both repeat customersand first-timers sufferiny in a tight economy. The has nearly 2,400 members nationwide, serving “middle class, working families who periodically experience an unexpected needfor short-terjm funds.” The average customer, accordinfg to the association, is 36 years old and has a householcd income of $29,000.
The average loan is $75 offeredf at 20 percent for 30 to 60 InNew York, the maximum allowable interest on a pawn is 4 Why would someone visit a pawn broker? The association says it is convenience and fast turnaround that appealp to most customers. There’s also no credit check or legaol consequences if a loan is notrepaixd – just the forfeiture of the collateral Nathaniel Barker, a longtime customer at Prudential, recalls bringing jewelrt back and forth from the Broadway shop repeatedly over the past 30 Barker, who sells clothes for a living, says he doesn’ t buy jewelry from anyone but Prudentiapl – partly because he knowsa he is guaranteed a 50 percent loan on those or at least his purchase price back on a trade.
“It’e a quick and easy way to get cash when you need he says. Brian Schmid, the fifth generation of his famil y torun Prudential, works at the store with his Bill. The store, he says, has been buyinh and selling gold and other jewelry fordecades – long before the currenty fad of gold parties and sellin gold for cash. Pawning offers an alternative to Schmid assesses the piece first for conditiomand value, then makes an with a higher valu offered on buys.
If the customerd chooses a loan, she has six monthws to repay the collateral loanwith “Things have been steadily increasing,” he “We’ve always had a good flow every day, regardleses of the economy – whether it be pawning or Schmid says. “But everything has been amped up with the stat e of the economy and the state of gold prices over thelast six, sevej months.” Located inside a former bank Prudential has the look of an upscale jeweler, though a thicjk wall of glass separates customers from employees. Everything is allowing for faster tracking of interest owed and background infoon customers.
“A lot of people have the perception that pawn shops are a shady but short-term it’s a better deal than a credit says Bill Schmid. “People will say, ‘Ij six months, I hope to be in better shape’. For a lot of people, it’a an insurance policy.” Another option for thosd short on cash isthe buy-and-sell, whicb operates a little differently, offering cash with no promise an item will be availabl e when the customer has the cash to come back for it. in Niagaras Falls is located inside a renovated housse onPine Avenue, with loud signs outside hawkingh jewelry, video games, clothing, antiques, car audio bikes – just abouft anything.
Ruben Longoria, who opened the businesx nine years ago, says business is He just opened his third storde nine months ago innearby Wheatfield. “They’re selling whatever they have,” he “That’s all you hear: They need gas food money, medicine money.” Diamond a Niagara Falls pawn shop, continues to see its regular customers just trying to get througu themonth - as well as newcomerz hit hard by job losses and pay cuts, says Stev e Huett, store manager. “A lot of peopls are desperate to pay theirt bills in any manner they he says. “We have some people that come in to pawn somethinf just tobuy groceries.
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