Return of the Pawnbroker
What do you think of when you see the word pawnbroker? The slums of Dickens? The austerity-years of the 1930’s Great Depression? Think again; modern pawnbrokers are rather smart establishments, and don’t look out of place on the high street.
After World War II the pawnbrokering went into something of a decline and by the Seventies it had almost died out as a trade with maybe just fifty or so in the whole of the British Isles, generally in poorer areas which boasted a high concentration of itinerant workers. Now there are over a thousand pawnbrokers in the UK and they are appearing in traditionally affluent areas. The industry is worth an estimated £100 million per year! The Australians have also followed suit with their Cash-Converters, high street buy-back chain.
What’s caused the change? Many of us seem to have lost faith in the banking system which in turn seems to have lost faith in itself as it restricts credit. People suddenly see pawnbrokers as a way of generating cash.
Modern pawnbrokers offer a discreet and confidential service where clients can pledge anything from a piece of jewellery or a watch through to a prize car or even a house. One London pawnbroker says he was once offered a Lear Jet!
Likewise the clients have changed too. In the old days it was men trying to make enough to pay the rent man or the landlord. Now it’s just as likely to be a middle class couple looking for a way to pay the mortgage or the school fees.
So how does it work? Pawnbrokers and their like give a client money in return for an object that is held as security until the customer pays off the loan and any interest charges. There are no credit checks and, once the item is valued and a rate of interest agreed, the customer leaves with the money.
If the loan is paid back within the agreed time the client can reclaim their goods. If the loan is not paid back then the pawnbroker has the right to extend the terms or sell the goods, though many are reluctant to do this as they thrive on repeat business.
Buy-back shops are slightly different. Here the client sells their item with an option to buy it back within 28 days. If they don’t reclaim it then the shop can sell the item.
The Consumer Credit Act states that a pawnbroker must give their client a receipt displaying the date the redemption period ends; the amount of credit secured by the pledge, and the interest rate, plus any other charges that individual lender may apply. If you lose your receipt inform your pawnbroker immediately so that no one else can present it.
68 To advertise in thewire t. 07720 429 613 e.
fiona@thewireweb.co.uk
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