Americans rich and poor pawn more to pay bills

Sun Dec 14, 2008 7:21pm EST
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By Sue Zeidler and Tim Gaynor

BEVERLY HILLS, Calif./PHOENIX (Reuters) - Whether it's a Tiffany diamond or a three-year-old lawnmower, more and more Americans from all social classes are pawning their possessions to make ends meet.

Pawn shop owners see strong business across the country, even in unexpected locales like Beverly Hills, the mecca of luxury living and shopping.

"Banks aren't lending so people are coming here for short-term loans against collateral like diamonds, watches and other jewelry," said Jordan Tabach-Bank, CEO of Beverly Loan Co, self-described "pawnbroker to the stars."

"I do see my share of actors, writers, producers and directors," he said, but also cited more visits from white-collar professionals and especially business owners struggling to meet payroll obligations.

"We still do the five-, six-figure loans to Beverly Hills socialites who want to get plastic surgery, but never have we seen so many people in desperate need of funds to finance business enterprises," he added.

In the 70 years of the family business, Beverly Loan, which usually charges 4 percent monthly interest on loans, has never loaned so much as it has in the past few months, he said.

"We're a lot easier to deal with than a bank," he said from his office on the third floor of a Bank of America building near Rodeo Drive. An armed security guard watches over the reception, where case after case is filled with precious gems.

It's less glamorous at Mo Money Pawn, located in the grimy area of central Phoenix, where struggling building contractor Robert Lane waited for the shop to open its doors so he could pawn a table saw he bought for $900.   Continued...

<p>Luxury watches and jewellery are shown on display at Beverly Loan Company, an upscale pawn shop in Beverly Hills, California pawn shop December 10, 2008. Pawn shop owners see strong business across the country, even in as unexpected locales like Beverly Hills, the mecca of luxurious living and shopping. Picture taken December 10, 2008. REUTERS/Sue Zeidler</p>