Pawning becoming more popular loan option

12/12/2011

Getting an SBA loan remains a difficult venture for many small businesses. Specifically, microloans tend to have the most obstacles, with lenders usually not willing to spend the time or effort involved for such a tiny venture.

However, Crain's New York Business reports that there are alternatives for less expensive loans, such as pawn shops, for small borrowing needs.

In order to obtain such a loan, business owners should find items of value. Typically, shops look for things they can easily resell, such as precious metals and jewelry. Handbags are also popular.

Also, the news source suggests shopping around for the right pawn shop, as appraisal prices differ from store to store. Sometimes, shop owners will ask a person to send pictures of valuables via email to be analyzed prior to coming in. Once chosen, make sure the shop is licensed by the state to avoid getting swindled.

Because of their quick turnaround time and ability to provide small amounts of value, pawn shops have seen a rise in popularity lately, the Daily Record reports.

"There's an awful lot of people who went on unemployment compensation and extended benefits and still couldn't find a job. At that point, you have to do something to get money," economist Joel Naroff, told the news source.