I was interested to read this Wall Street Journal article describing a boom among pawnbrokers. It’s interesting to see that as credit cards clamp down on credit lines and banks aren’t lending new money, even high net worth Americans and business owners are turning to pawn shops for short-term loans to get through rough spots. Have you used a pawn shop for a short term loan? Would you?
In desperate times, it seems to me pawning something is a better route than taking a payday loan or a credit card cash advance. Of course, if you just need to fill up you tank or pay the electric bill until you get paid next week, you can make the purchase with a credit card and, if you repay the charge within the card’s grace period, won’t pay any interest at all.
If you don’t have available credit on a credit card, or if you need cold hard cash, pawning seems to be a better option. I’m curious to know what you think–and if anybody’s ever done it.