For Pawnshop Owners the Sun Is Shining In This Foreclosure Climate

December 18th, 2008 | Tags: Foreclosure

For everybody the weather is not cloudy. For pawnshop owners the sun is shining in this foreclosure climate. During these days of economic slump everybody is rushing to the pawnbroker with an assorted lot of articles ranging from diamonds to an old lawnmower. Cutting across social divisions a good number are making a beeline to the pawnbroker’s shops pawning their goods to survive. For pawnshops it is good business – even in unexpected localities like Beverly Hills.

Jordan Tabach-Bank is the CEO of Beverly Loan. He describes himself as the ‘pawnbroker to the stars.’ He explained, “Banks aren’t lending so people are coming here for short term loans against collateral like diamonds, watches and other jewellery.” His work brings him in contact with actors, authors, producers as well as directors. Also coming to him are white-collar professionals and other business personnel struggling during these hard days.

However business goes on as usual with five to six figure loans for socialites who want to opt for plastic surgery. But he has never seen a surge of so many coming desperately in need for funds to keep the business going.

The family business is seventy years old. Generally it charges 4% per month on loans. During the past few months he has made a record number of loans. Jordan claims that pawnbrokers are much more easy to deal with than banks. His office is on the third floor of a Bank of America property located near Rodeo Drive. An armed guard stands near the reception in front of showcases choc-a-bloc with precious items.

Mo Money Pawn is a more modest unit located in central Phoenix. But business is sharp as Robert Lane, a business contractor found out waiting for the shop to open. He wanted to pawn a table-saw that he had purchased for $900. He was under great pressure to clear some bills and hoped to get $300 for his beloved tool – something that he rarely uses now that business is at all time low during this foreclosure crisis.

Across America there are 15,000 pawnbrokers. As the foreclosure crisis worsens and the recession deepens pawnbrokers are seeing an increase in their business. No statistics have so far been maintained but stray reports coming in show that they are prospering as the foreclosure crisis worsens and loans become scarce. Eric Baker the owner of Mo Money says, “Business is good!”