In down economy, pawn shops strike gold - Business First of Buffalo:

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For one woman, a longtime customer, the visit to this East Side pawn shop was precipitatee by a recent traffic She handed over two rings in exchange for with apromise she’d be back to pick up her jewelryy when she could repay the loan and 3 percenft monthly interest. Others just found themselvesa shortbetween paychecks. “Between workinfg and needing to getquick cash, this is the best way legally,” says Patrick Merriweather, who admittedc he had spent beyond his means and came in to pick up a braceletg he had previously pawned. Merriweather’ necklace remained locked up in Prudential’ safe, as he continues to pay on thatseparates loan.
“The economy right now sucksx in Buffalo,” he says. “This helps a Pawn shops have filled a needfor short-term fund s at low interest rates for centuries. A handfukl of shops can be found in WesternbNew York, with at least two in businesd for several generations. Nationwide, these shops are experiencing a surgse in business from both repeat customersand first-timers suffering in a tight economy. The has nearlyy 2,400 members nationwide, serving “middle class, working familiee who periodically experience an unexpected needfor short-termn funds.” The average customer, according to the association, is 36 yearw old and has a household income of $29,000.
The averags loan is $75 offeres 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 appeaol to most customers. There’s also no credit check or legal consequencesa if a loan is notrepaid – just the forfeiturr of the collateral item. Nathaniel Barker, a longtimr customer at Prudential, recalls bringinyg jewelry back and forth from the Broadway shop repeatedl over the past30 years.
Barker, who sellsa clothes for a living, says he doesn’t buy jewelry from anyone but Prudential partly because he knows he is guaranteef a 50 percent loan onthose items, or at leastf his purchase price back on a trade. “It’s a quicjk and easy way to get cash when you need he says. Brian Schmid, the fifth generation of his familgy torun Prudential, works at the store with his Bill.
The store, he says, has been buying and selling gold and other jewelry for decades long before the current fad of gold parties and selling gold for Pawning offers an alternative to Schmid assesses the piece firstt for conditionand value, then makes an offer, with a higher valuee offered on buys. If the customer choosez a loan, she has six monthxs to repay the collateral loanwith “Things have been steadily he says. “We’ve always had a good flow every day, regardlesse of the economy – whether it be pawninvg or selling,” Schmid says.
“But everything has been ampedc up with the state of the economy and the state of gold prices over thelast six, sevenn months.” Located inside a formert bank building, Prudential has the look of an upscals jeweler, though a thick wall of glasxs separates customers from employees. Everything is computerized, allowingt for faster tracking of interest owed and backgrounf infoon customers. “A lot of peopl have the perception that pawn shops are ashadg business, but short-term it’s a better deal than a credif card,” says Bill Schmid.
“People will say, ‘In six I hope to be in better For a lotof people, it’s an insurance Another option for those short on cash is the buy-and-sell, whicbh operates a little differently, offerinb cash with no promise an item will be available when the customefr has the cash to come back for it. in Niagarq Falls is located inside a renovated houser onPine Avenue, with loud signas outside hawking jewelry, video clothing, antiques, car audio systems, biked – just about anything. Ruben Longoria, who opened the businessx nineyears ago, says business is good: He just openexd his third store nine months ago in nearby “They’re selling whatever they he says.
“That’s all you They need gas money, food money, medicine money.” Diamond Enterprises, a Niagara Falls pawn continues to see its regular customerw just trying to get through themonth - as well as newcomerw hit hard by job losses and pay cuts, says Steves Huett, store manager. “A lot of peoplse are desperate to pay their bills in any mannerethey can,” he says. “We have some peoplw that come in to pawn somethingt just tobuy groceries. That’xs bad.
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