Archive for May, 2010
Sunday, May 30th, 2010
From Boston Dot Com
A family’s heirloom, history are reclaimed
By Kevin Cullen, Globe Columnist | May 30, 2010
As soon as his boys could walk, Francis “Fuzzy’’ Hector took them on airplanes at Air Force bases. He wanted them to stand inside the belly of a transport and get that rumbling feeling in their own bellies.
“Man,’’ Derek Hector was saying, “my brother Chris and I, we went to air bases all over the place when we were kids.’’
They called him Fuzzy because he was fast.
“My dad ran track for Boston English,’’ Derek Hector said, “and he could fly.’’
Then World War II broke out and Fuzzy Hector really did fly. He went to train in Alabama as one of the Tuskegee Airmen, a group of African-American warriors deemed good enough to be part of an elite Army Air Corps unit, but not good enough to be considered the equal of a white man. Fuzzy Hector was a gunner and a radio operator.
After the war, Fuzzy Hector came back to the South End and raised two boys with his wife, the lovely Edna. He went to college and worked as an account executive for a liquor distributor for 30 years. And he kept telling all the other Tuskegee Airmen he would see around Boston that they had to do something, that they couldn’t leave their history to somebody else.
So they formed a local chapter of the Tuskegee Airmen and they would go into the schools and talk to the kids, and they would get together, old soldiers, and tell war stories, and whenever a Tuskegee Airman would die, Fuzzy and the boys would be there, at attention, snapping a final salute to a Lonely Eagle.
Fuzzy and Edna were married for 50 years when he died in 1998. Tuskegee Airmen, old black men in gray slacks, blue blazers, and ties the bright red color of their airplane tales, lined Charles Street AME Church and saluted Fuzzy Hector one last time.
“When my dad died, Chris really was the one who had to take care of things, take care of my mom, look after my dad’s affairs,’’ said Derek Hector, who had moved West in 1992, eventually to Chicago, where he worked as a tailor.
Chris Hector had to take care of himself, too, and that wasn’t easy after Vietnam. He had joined the Air Force, because of and in tribute to his father.
“The doctors said he was exposed to Agent Orange, and he had other problems,’’ Derek Hector said. “When he got out of the service, he had health problems the rest of his life.’’
Chris Hector got a job in the post office and that’s where he was working when Mike Goldstein first met him. Goldstein runs Empire Loan in the South End, and Chris Hector would come in to pawn jewelry.
One day, after his dad died, Chris Hector walked in and said he wanted to pawn his father’s Tuskegee Airmen ring, a heavy gold band with a blue stone.
“He told me about the history of it, about his father, about the Tuskegee Airmen,’’ Goldstein said. “I knew he was just borrowing against it, because in all the years I knew him he had never lost anything to foreclosure, and he certainly wasn’t going to lose his father’s ring. He pawned it dozens of times, over a six-year period, and he always paid back the loan and got the ring back.’’
Five years ago, Chris Hector stopped making payments on the last loan, for $150, that he took against the ring. In fact, he just stopped coming in.
He stopped coming in because he got sick and died. This took Goldstein months to find out. Goldstein was entitled to sell the ring or scrap it, but he couldn’t do it.
“I held that thing in my hand and it felt like history,’’ he said. “I just wanted to give it back to the family.’’
Goldstein put the ring in a safe and tried to find the family. He left a message with Edna Hector, but its significance didn’t register, and so the ring sat in a safe at the corner of Washington and East Berkeley streets for the last five years.
“It was one of those things, I just put it on the back burner and I figured I’d get to it some day, and the months passed and the years passed,’’ Mike Goldstein said.
Then one day he was reading Lena Horne’s obituary, and there was a story about how when Horne went overseas to sing during World War II, German POWs got better seats than African-American soldiers. Mike Goldstein thought of Fuzzy Hector’s ring again. He was sitting in his office and he looked at the calendar and saw Memorial Day was coming up and he knew he had to do something.
Mike Goldstein is a pawnbroker, not a detective, so he asked the people at his advertising agency, Mittcom, if they had any ideas. One of the supervisors, Alicia Pensarosa, started looking around and found Willie Shellman, president of the New England chapter of the Tuskegee Airmen. All she had to do was say the name Fuzzy.
A couple of days ago, Derek Hector went back to the South End for the first time in so many years he couldn’t remember.
“I remember it as Dover Street, not East Berkeley,’’ he said.
Then he walked into Empire Loan and Mike Goldstein handed him his father’s ring. He told Mike Goldstein he had given him a piece of his father back.
“This is the only thing of my dad’s that I have,’’ Derek Hector said.
Edna Hector is dying, and Derek Hector is back in town, taking care of her in her last days. Derek Hector put the ring in his pocket and went to see his mother.
“Mom,’’ he said, “I got dad’s ring back.’’
“That’s nice,’’ Edna Hector said. “You know, Chris has got to be more careful with your father’s things.’’
Tags: Boston, consumer credit, Empire Loan, Pawn Loans, pawnbroker, pawnshop Posted in Pawn Shop Stories | 1 Comment »
Thursday, May 27th, 2010
From Market Wire Dot Com
LONDON, UNITED KINGDOM–(Marketwire – May 27, 2010) – The recent surge in the price of gold has seen a huge increase in people choosing to take loans against or sell gold, rather than buy it. More people than ever before are now scrapping their gold items or achieving high loan amounts as gold values have rocketed in these uncertain economic conditions.
This is good news for pawnbrokers up and down the country, who are reaping the rewards of the constant supplies of gold provided to the international market. There has been a huge boom recently in people deciding to pawn gold, with many pawn shops appearing all over the country as a result. These increased prices mean pawnbrokers are able to offer customers much bigger loan values than previously as items are worth more providing greater security against the loans.
A spokesperson for Borro the UK’s first online pawnbroker says: ‘The increase in the price of gold came at a time when people were struggling to get a loan from banks, who were making it even more difficult to obtain finance and redundancies were rife up and down the country.
‘But as well as providing a way of getting from one month to the next, pawnbroking has also made people realise that they can afford luxuries through releasing extra cash from increasingly valuable items.’
Another factor which is likely to be attracting new customers to pawnbrokers, is the fact that credit ratings will not be affected if they cannot pay back a loan, as it would be by high street banks. Pawnbrokers traditionally sell off items if customers can not afford to pay back the capital and the interest, but credit ratings stay unaffected. So in that respect it is a low risk solution for many and with the incredible value of gold right now, this looks set to remain unchanged.
Headquartered in Oxford with offices in London, Borro.com was the UK’s first online pawn shop, changing the face of pawn broking by offering consumers a discreet, safe and hassle-free way to borrow money against their personal valuables.
Tags: borro.com, consumer credit, Gold Prices, Pawn Loans, pawnbroker, pawnshop Posted in Pawn Ecomomics | 1 Comment »
Monday, May 10th, 2010
From Philly Dot Com
High-end payday loans
By Harold Brubaker
Inquirer Staff Writer
From his pawnshop at 10th and Sansom Streets in Center City, Tod Gordon has an unusual window on credit and the economy.
Carver W. Reed & Co. Inc. is not the stereotypical pawnshop where the walls are lined with guitars and the glass cases are filled with cameras.
Instead, Carver W. Reed, which celebrates its 150th anniversary Tuesday, specializes in loans that use diamond and gold jewelry exclusively as collateral.
Gordon said his business had catered to wealthier clients for decades. Even so, he said, in 2008 and 2009 he saw a huge increase in the number of business owners pawning the gold watches and diamond jewelry they had bought in better days.
They needed the money to pay their employees, Gordon said, and could not borrow it from a bank.
“The number of people that have come in from walks of life that I never expected to see has been overwhelming,” Gordon said. His grandfather bought the business in 1949 from descendants of the founder and kept the name.
Most customers who started borrowing from him during the financial crisis are still playing catch-up, he said.
On the plus side for the economy, he noted, wholesale and retail demand have improved for the jewelry he ends up selling because loans are not repaid.
“I’ve noticed a dramatic swing in the last three months. People are starting to come back out again and spend money and buy again,” said Gordon, who zealously guards his clients’ privacy.
He also declined to disclose the value of his outstanding loans because each is backed by jewelry worth three or four times as much as the loan.
The Pennsylvania Department of Banking regulates pawnbrokers and limits the amount of interest that can be charged to 3 percent per month, Gordon said. That adds up to a high rate over a year, but for a month a $10,000 loan costs $300.
“You can’t go to a bank to get that,” Gordon said.
Building contractors take advantage of such financing to make payroll and buy supplies, he said.
“Their stuff is back out in 60 days max,” Gordon said. “I have many contractors; they are all big loan people.”
There are 57 licensed pawnshops in Pennsylvania, the same as three years ago, according to the state Banking Department. New Jersey has 35 licensed pawnbrokers.
The 2,600-member National Association of Pawnbrokers, based in Keller, Texas, says that most pawnshops are family businesses and that they are regulated by all the federal laws that apply to other financial institutions, such as the Truth in Lending Act and the Bank Secrecy Act.
“It’s an intriguing business,” Gordon said. He has worked full time at Carver W. Reed since graduating from college in 1977 and is thrilled to have a daughter in the business now.
He clearly enjoys people and the insights he gains on the economy. He talked about a new customer, a manufacturer of furniture for boats, who has been in business for 38 years and for the first time could not make payroll.
“That, to me, was a real sign of a trickle-down effect,” Gordon said.
“Everybody says, ‘The cruise lines are hurting,’ but nobody thinks about the guy making furniture for the cruise lines.”
Tags: consumer credit, Economic Indicator, Pawn Loans, pawnbroker, pawnshop, Philadelphia Posted in Pawn Shop Stories | 4 Comments »
Saturday, May 8th, 2010
From Wall Street Journal Blog
May 7, 2010, 3:08 PM ET.
Taking Stock Of Being In Hock,
VCs Fawn Over Internet Pawn.Pawn shops may bring to mind images of rejected engagement rings, second-hand Stratocasters and giant neon cowboys directing the way to cash for gold and silver.
But pawnbroking, as a business, is essentially one of the world’s oldest and simplest forms of banking. Here’s how it works: An item of personal property is used as collateral to secure a loan. If that loan is defaulted, the pawnbroker can sell the property to recoup the loan value.
Todd Hills is a 25-year veteran pawnbroker who currently owns seven pawn shops in the Salt Lake City area. Hills, following in the footsteps of many other traditionally brick-and-mortar businesses, saw an opportunity to bring his expertise to the Web.
An Internet pawn shop. Why not?
Some venture capitalists had the same reaction, and Hills recently secured a $1.5 million Series A round of funding from Daylight Partners and Access Ventures to launch Internet Pawn Inc.
“I decided it was time to pull this off online,” said Hills, the start-up’s founder and chief executive. “There’s a whole customer base out there that has never had to deal with a pawn loan. With everything going on in the economy and the lack of credit, there are a lot of people who this is right for.”
With Internet Pawn, customers simply fill out an application form online and receive a provisional offer. If they accept the offer, they send their items to Internet Pawn and a loan is transferred upon arrival.
The minimum loan size is $250. While the APR varies based on the fees and loan size, a standard $500 six-month term loan, for example, would have a 72% APR. That compares with a 180% APR for a $500, 30-day loan at a traditional pawn shop, Internet Pawn’s Web site said.
Denver-based Internet Pawn will place a loan on anything of value, from diamonds, art, gold and jewelry, to automobiles and motorcycles.
Many forms of bricks-and-mortar commerce have made their way to the Internet, but pawnbrokering is a segment where a clear leader hasn’t emerged. Jay Campion, managing director at Access Venture Partners, said finding a business model that has worked for more than 3,000 years and having the opportunity to bring it online is one of the biggest factors that attracted him to the investment.
The pawnbroking business can carry with it some unsavory associations. In the popular imagination, pawn shops are seedy storefronts in the bad part of town that may support the fencing of stolen items or take advantage of people in desperate financial situations. It’s a stigma that investors had to consider before writing a check to Internet Pawn.
“The company is called Internet Pawn and it’s the best way to describe the company,” Campion said. “People have to get used to it. We have to tell a good story about how people who wouldn’t go to a bricks-and-mortar pawn shop have received loans with privacy through Internet Pawn.”
Privacy is one of the company’s advantages and could ultimately be the factor that makes the company a success. A person can obtain a loan through Internet Pawn without ever leaving their home.
“There’s a little bit of embarrassment when you have to take your Rolex down to your local pawn shop,” Hills said. “We remove that process.”
Tags: consumer credit, Internet Pawn, Pawn Loans, pawnbroker, pawnshop, Wall Street Journal Posted in Pawn Shop Stories | 2 Comments »
Friday, May 7th, 2010
From Reuters Dot Com
Mexico micro-lender mulls pawn shop expansion
Thu, May 6 2010
* Firm sees pawn shop as gateway for borrowers
* Mergers expected in Mexico pawn sector
By Patrick Rucker
MEXICO CITY, May 6 (Reuters)- One of Mexico’s largest micro-lenders could expand into pawn shops to reach more borrowers who cannot access traditional forms of credit, the company’s chief executive officer said on Thursday.
Financiera Independencia typically offers unsecured loans as small as a few hundred dollars to borrowers who want to open or expand a business.
Many clients who cannot even qualify for a micro-loan turn to pawn shops, putting up personal items as collateral for cash loans at interest rates above 4 percent per month. Financiera Independencia could easily expand into that market, said board Chairman Jose Luis Rion.
“It appeals to me,” he said of the sector. “(Pawn shops) are an easier entrance for our customers.”
Many Mexicans are familiar with the corner pawn shop as a lender of last resort, where they can get cash using collateral like musical instruments, tools or other valuables. In a nation where large banks often ignore low-income borrowers, the hock shop is a familiar source of credit.
Rion said the pawn sector is ripe for consolidation and that a firm like his could introduce valuable efficiencies.
“You have some corporate pawnshops now that are consolidating and growing. I believe that in time there will be fewer competitors, more institutional, more corporate,” he told Reuters. “Right now we have our hands full but it is definitely an interesting market.”
Development agencies around the world have promoted micro-credit as a way to help small entrepreneurs but critics say many dominant players in the sector charge extortionate interest.
Rion said the high interest rates are justified because of the risk and expense of handling such loans.
“You have to collect, you have to call, you have to do paperwork. That can all account for 95 percent or sometimes more of the revenue from the loans,” he said.
Still, the business model can be profitable, with Financiera Independencia reporting a 21 percent net income increase in the first quarter over the year-ago period.
PAWN SHOP GROWTH
Loans made at Nacional Monte de Piedad, Mexico’s largest chain of pawnshops, rose about 20 percent during the first three weeks of January compared to the same period in 2009.
In late March, Financiera Independencia sold $200 million of senior unsecured notes that carry a speculative grade rating and the company is still digesting that capital.
“We just had this dollar issue,” Rion said, speaking in the wings of a mergers and acquisition summit. “We are considering options to give the stock more liquidity, more flow. We are really busy but if something like that comes and it looks fine, we will consider it.” (Reporting by Patrick Rucker and Luis Rojas Mena; Editing by Richard Chang)
Tags: consumer credit, Mexican Economy, Mexico, Pawn Loans, pawnbroker, pawnshop Posted in Pawn Ecomomics | 5 Comments »
Tuesday, May 4th, 2010
From: News 10 Dot Net
Family tradition secret to
100 years of success of
Sacramento pawn shop
Jennifer Smith
SACRAMENTO,CA – It is Sacramento’s oldest family-
operated pawn shop celebrating over 100 years in
business in downtown Sacramento.
California Loan & Jewelry Co. is one of many long-
surviving businesses in the Sacramento region who
have weathered the Great Depression and now the
current recession.
“We’ve now gone through three generations and
we’ll go on hopefully another 100 years,” said
Warren Anapolsky who currently runs the business
with his brother Larry. The company was originally
founded in 1909 by twin brothers William and Joe
Anapolsky.
As the years passed, there have been plenty of
changes in the kinds of items being pawned. “Our
grandfather used to take in suitcases, hats, and
razor,” said Anapolsky. “My father in the 40s, 50s,
and 60s was taking in typewriters, and transistor
radios.” The company’s current niche is jewelry.
Anapolsky says when times are tough, people come
to his store to borrow money to continue making
house payments or to put food on the table. When
times are good, he says there’s still a segment that
needs to borrow money, but others are looking for
good value when buying.
Anapolsky credits family tradition for the company’s
longevity. “We’ve learned from dealing with our
parents and our parents dealing with their parents
the value system of integrity value and service,” he
said. “It’s been a winning combination for us for all
these years now.”
By Jennifer Smith,
News10/KXTV
Tags: California Loan, consumer credit, Pawn Loans, pawnbroker, pawnshop, Sacramento Posted in Pawn Shop Stories | No Comments »
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