If you thought that the pawn-shop industry was all about people handing over their cheap watches to pay for a night at the bingo, then it is time to think again.
Today’s pawn shops lend cash on everything from helicopters and flash cars to world-renowned paintings and fine wines. What is more, they are also the stars of a new genre of television show, such as History’s Pawn Stars.
Planes, Picassos and Ferrari-fuelled festivities
A Surrey-based Prestige Pawnbrokers, has loaned against a £150,000 Ferrari, a £1 million helicopter, and a £25,000 Hermes handbag. The company is the star of Boomerang’s The Pawn Shop, which is now shown on Channel 4. These high-value brokers are often known as asset finance companies.
Prestige’s founder, James Constantinou, said his company had loaned against such astonishing items as boats, planes and paintings by Lowry and Picasso.
Mark Landsberg, a 53-year-old computer entrepreneur, used his Porsche 911 Turbo to get £20,000 to help with his cash flow and to pay a tax bill. He needed the money to tide him over between quarterly payments by clients, and told the Express newspaper that he was happy to have his Porsche in storage for a while as he had another car he could drive.
He wanted to use the cash over the Christmas period to have a good time and planned to organise a £3,000 lunch, including vintage champagne, and splash out on expensive gifts for his family. A year before, he pawned his Lamborghini so he did not miss out on a business opportunity. He paid back the £50,000 he borrowed five weeks later.
Mr Constantinou knows that this sort of activity is common, and has customers who want to fund everything from dental work and school fees to divorce lawyers and funeral arrangements. In recent times, Prestige has loaned £150,000 against items from a vintage wine collection, £30,000 for a Bentley and £3,000 for a vintage Chanel handbag.
Designed to raise cash
Tiffany Jackson told the Daily Mail that she decided to employ the services of a pawnbroker when her husband James lost his city job and cash was short while they waited to sell their six-bedroom home. The 32-year-old designer clothes fan decided to raid her expensive wardrobe to raise the money the couple needed. She ended up handing over a Rolex watch worth £6,000 and an £18,000 Chanel handbag made of crocodile skin. She used the £4,000 she made to pay credit card bills.
It seems that women and small business are helping to make pawnbroker businesses boom, and single mum Stella Brody, a 45-year-old, is another who has used designer clothes to get cash for her company. She pawned a £7,000 Elizabeth Arden wedding dress as well as a wedding dress from Dior.
Mother-of-two Jane Wall-Budden, 29, pawned Rolex and Cartier watches to fund a £3,000 investment in her business. A flooded bathroom, meanwhile, prompted divorcee Lorraine Giacomelli to pawn a £17,000 Hermes bag, a pair of Christian Louboutin shoes worth £1,000, and a £2,000 handbag by Chanel.
Pawnbroking is certainly not a new idea and it is not the first time that a woman has thought about her clothes and jewellery as assets. Spain’s Queen Isabella, for example, offered to pawn the crown jewels to fund Christopher Columbus’s travels to the New World. England’s King Edward III raised money for a war with France by pawning his jewels, and Henry V did a similar thing. Pawnbrokers are known to have existed in the Roman Empire, in Ancient Greece and 3,000 years ago in China.
Valuables from the vault
Gems are far from the most unusual items to be pawned as viewers of History’s Pawn Stars programme will know, having seen everything from items signed by some of the world’s most famous names to deadly weapons being bought in. The World Famous Gold & Silver Pawn Shop in Last Vegas, the focus of the Pawn Stars show, has loaned money against some random items such as a Super Bowl ring from 2001 worth £60,000 and One-kilo gold bars worth £128,000.
Other unusual items that have passed through the business include a tiara that belonged to former American First Lady Ida Saxton McKinley, a Fender Stratocaster guitar (once played by Jimi Hendrix), a cheque signed by baseball legend Babe Ruth, a car apparently once owned by Cuba’s Fidel Castro, a handwritten poem composed by Marilyn Monroe and the original contract between manager Brian Epstein and the Beatles.
Multi-million pound industry
You only need to switch on your television set to know that pawn shops are big business. The analysts at Apex Insight have revealed that an industry that was worth £296 million in 2007 had grown to a value of £851 million by 2013. The figures show that there were four stores opening every week in Britain during 2012. The National Pawnbrokers Association says it now has more than 1,800 members in the UK. This is in stark contrast to the 1980s, when there were fewer than 50 pawnbrokers in the country.
Despite the undeniable increase in popularity of the pawn shop, however, it is not an option for everyone. Handing over a family heirloom can be a heartbreaking business, no matter how confident a person is in their ability to pay to get their item back.