Pawn shops' popularity rises with TV shows, down economy
The Van Nuys Pawn Shop in Los Angeles is seeing an increasing number of customers turn to it for short-term loans.
March 9th, 2012
06:43 PM ET

Pawn shops' popularity rises with TV shows, down economy

For years, pawn shops have had a seedy and hopeless connotation: people pawning items for short-term loans because they can’t get a loan from a bank or don’t qualify for mainstream credit. But over the past five years or so, pawn shops have had a whole new light shed on them.

In this down economy, especially with high credit-card and bank-loan interest rates, pawn shop business is up. Pawn popularity also is up because of reality shows like the History Channel’s "Pawn Stars."

(Click the audio player to hear more on this story from CNN Radio's Jim Roope)

"Pawn Stars" features the Gold and Silver Pawn Shop in Las Vegas and its owner, Rick Harrison, who says pawning is banking at its most basic.

"You give collateral on a loan; (if) you don’t pay it back, you lose your collateral, and that’s the end of it," Harrison said. "There is no turning you into a credit reporting agency. There’s no suing you, no garnishing your wages. It’s just that simple."

Cesar Salgato, manager of Van Nuys Pawn in Los Angeles, says that over the past four or five years, his business has increased 60%.

"A lot of the middle class and upper middle class is starting to pawn," Salgato said. "It's incredible, the amount of money that goes out for meeting mortgages and meeting payroll."

Stacey Simons is a real estate broker who was pawning collector plates.

"I needed the money," Simons said, giggling. "Times are tough, and I needed the money."

Simons is a regular customer at Van Nuys pawn.

"This, you can pay every three months. There's a little bit of a fee, and they keep your item, and when you’re ready to get it back, it’s there for you, and it's not damaged," Simons said.

According to the National Pawn Brokers Association, there are 13,000 pawn shops in the United States, and they conducted 30 million transactions last year.

The fees are regulated state by state, but there are federal regulations by which pawn shops must operate. The fees or interest rates can be relatively low.

“On a $1,000 loan, for the first 90 days, you only pay $70," Salgato said. "After 90 days, it goes up slightly to $110. So if you divide that by the four months, it’s a small amount."

Still, pawn shops can charge much more. In New York, pawn shops can charge up to 4% per month in interest, which would come out to a 48% APR, CNNMoney's Poppy Harlow reported. Pawn shops in other states can charge up to 25% per month, Harlow reported.

Get pawn shop tips from CNNMoney

According to the National Pawn Brokers Association, 80% of people who pawn return to recover their items.

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Filed under: Economy • Showbiz • TV
soundoff (125 Responses)
  1. citizen

    Aside from pawn shops another trend in the new global economy is pink slime.
    Now that the Chinese are eating more red meat Americans must eat more pink slime. The positive take away from this is that as a basic issue of fairness it is good to see the Chinese enjoying a larger slice of the economic pie. Wal-Mart has no comment.

    March 9, 2012 at 7:32 pm | Report abuse |
  2. Joey Isotta-Fraschini©™

    It's OK: many Americans prefer cake anyway.
    Oreo cookies...
    Greasy chicken...
    Flour-free doughnuts...

    March 9, 2012 at 7:58 pm | Report abuse |
  3. AMERICA 1st

    Chumlee on Pawn Stars is cool. Its a great show!

    March 9, 2012 at 10:03 pm | Report abuse |
  4. chrissy

    lmao @ the pink slime comment! As for the pawn shops, we will soon see the l% become 2% huh? Lmao! Good evening Joey, and you can keep them nasty oreos lol.

    March 9, 2012 at 10:21 pm | Report abuse |
  5. chrissy

    hmmm who did what?

    March 9, 2012 at 10:59 pm | Report abuse |
  6. chrissy

    Lmao still pouting? That figures too.

    March 9, 2012 at 11:04 pm | Report abuse |
  7. chrissy

    my prior 2 posts were @ anti hamsta club.

    March 9, 2012 at 11:06 pm | Report abuse |
  8. chrissy

    @ anti hamsta, I believe it may be caused by vitamin deficiency, 40 ouncers for dinner will do that to a person. Lmao!

    March 9, 2012 at 11:10 pm | Report abuse |
  9. hamsta

    nice to know all of you cowardly gossip queens talk about me behind my back.thats exactly why i told chrissy i would make her chickenhead self sleep in the shed.she was badmouthing her roommate behind his back.makes no difference if its her house or not,she was wrong for that.i dont need to here about his snoring and joblessness.she needs to be a real woman and tell that to her roommate.

    March 9, 2012 at 11:19 pm | Report abuse |
  10. Dana Bash

    Oh Chrissy. You have such a sweet disposition. So glad to read your posts.

    March 9, 2012 at 11:34 pm | Report abuse |
  11. Scottish Mama

    Hamsta what is your damage? I tried to talk last night and you bailed?

    March 9, 2012 at 11:43 pm | Report abuse |
  12. chrissy

    lmao im celibant hamsta therefore i cant be a chickenhead. And hes not my roomate fool, hes a mooch! And i didnt say nothin bout you i wouldnt say TO you.

    March 9, 2012 at 11:46 pm | Report abuse |
  13. banasy ©

    What's that one in Detroit, chrissy?
    That one has no class at all.

    March 9, 2012 at 11:49 pm | Report abuse |
  14. chrissy

    Ty @ dana, i try to be cheerful always, but a certain person i wont mention his name, due too his inferiority complex, likes to antagonize me!

    March 9, 2012 at 11:51 pm | Report abuse |
  15. chrissy

    No class. Lol

    March 9, 2012 at 11:52 pm | Report abuse |
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