A Nurse with a Gun

Wednesday, July 30, 2008

Unscrupulous Rumours

From a forum post:
So far all my gun purchases have been new. I'm not above saving money but I never felt right about pawn shop purchases. Do you trust them? Have you ever been burned in a pawn shop deal? Stolen merchandise? How do you tell a reputable pawn shop?
I buy a lot of guns from pawn shops. Some are dusty with high prices, others are clean and motivated to move merchandise.

There are several things to understand about pawn shops.

First, they are primarily financial institutions. They are lending agencies with a license to protect. They will protect that license to lend money, as it is their livelihood. They are not likely to risk it knowingly selling somebody's stolen second hand stuff. Being a FFL is second to being a financial institution with these guys. They do not have to sell guns. They do not need to sell guns to make a living. They make a living lending money. If they can break even on selling a gun to a fellow they like, they will. They already made their money on the loan in interest. Let them make a bit on the gun too, and you will become a cherished customer. If you treat him with respect and he believes you will return again, there is a fair chance he will sell you the gun for a small profit over what he loaned on it. Treat the pawn broker with disdain, and you will never find a deal there. He doesn't have to sell to you. Remember.......He may have made his money on that gun in interest and having it go in and out of hock. It is not merchandise. It was collateral.

Second, in most states the Sheriff's department has a pawn detail that regularly goes to pawn shops comparing the serial numbers on pawned items, including tools and guns, to lists of items reported stolen. Pawn brokers are pretty adept at spotting a thief. They do not want to loan money on a stolen item and then lose their collateral. If someone walks into a pawn shop with a Fender Telecaster and can't play it, chances are he won't be pawning it either. Pawnbrokers do not work as fences for known thieves. Doing so places their license as a financial/lending institution at risk. Plus they lose their collateral on money they loaned.

Third, pawn shops help people. Let's suppose you need money. Suppose your engine just blew up in your automobile, and you do not have the money it takes to replace or repair it, and you need to get to work so you can go on living. You have no money in the bank. Your friends don't either. You either don't want to go to the bank and take out a loan for the small amount needed, or your credit sucks and you can't. You can take out high interest pay day loans, you can use a high interest credit card, or you can see a pawnbroker.

At the pawnbroker's shop, you can walk in with an item of value, whether it be a firearm, a piece of jewelry, a camera, or whatever. He will appraise it, offer a loan based on that appraisal, and if you accept his offer, you sign a few documents to make certain you understand the deal, and you walk out with cash. That's it.

Pay back the loan at any time, or on schedule with the interest contained in the deal, and you get your property back. It's that simple. On a firearm, yes, you go through NICS.

Now let's suppose you experience a downward turn of fortune, and have a problem paying the loan back. You will not have a black mark on your credit score as a result. Try that with Visa or a pay day loan place. At the pawn shop, you just lose your property if you default on the loan. That's all. You have a clean slate. If it was a family heirloom that you pawned, either you should not have pawned it, you should have paid back the loan, or if neither of those are possible, you have the option of pawning something less precious to you and buying your heirloom back before someone else buys it.

While your property is in pawn, it is kept in a place that is reasonable for it's security, and the pawnbroker is responsible for it's condition. If it's a gun or jewelry, it is kept under a double lock, same as a FFL. Most likely, that entails a walk-in safe. I was surprised to learn how many hunters pawn their favorite rifles in the off season for safe keeping. In August, they pay off the remainder of the loan, take the rifle out of pawn, and go hunting. If it is burned, damaged, or whatever, the pawnbroker's insurance covers it, not the owner's homeowner's insurance. I know construction workers and contractors that do the same with their tools in the off season.

After hurricane Katrina, the pawn shops in my area were hopping for about two years as people who evacuated......... Good people, respectable people, who had a driver's license, a credit card or two and a car full of belongings and family, went about re-establishing their lives. Would the banks loan them money for gas or a hotel room? No way. They had no address any more. Would the cash advance places loan them money for gas or a hotel room? Not without a job. They could, however, walk into a pawn shop along their way to a final destination with a driver's license and a small item of value such as a diamond ring, or a handgun, and leave in 15 minutes with money for gas and a hotel room. If they never came back with their property, and a lot of them did not, it was simply resold. Folks like myself came and purchased the collateral.

Think about this....... The next week could bring any number of us to a situation where we need cash right then. It could be an auto accident, a natural disaster, a death in the family, or even a great deal on a once in a lifetime firearm that we need cash for. Cash right then. You could use the Visa or go to a pay day loan place. Or you could take something to into a pawn shop and learn a new tactic of survival in a declining economy. Your choice.

To decide for yourself whether pawnbrokers are unscrupulous thieves, go here. To read my pawn shopping secrets, go here. To hear the rumours about unscrupulous pawn shops, just go to your local gun store and ask. Then follow the old guy behind the counter, you know, the one with the nice gun collection....... to his favorite pawn shop and watch him check the latest wares on his way home.

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Anonymous Standard Mischief said...

maybe it was the wrong item to try to buy, but I remember spending a half an hour piecing together a set of metric combo wrenches out of a pawn shop's unpriced loose tools bin. Bringing them to the counter I was quoted a price well above what the rate was for a new set of Craftsman tools.No joy haggling. I left them on the counter and focused on yard sales and thrift shops thereafter.

10:18 PM  
Blogger Joe Allen said...

Just like to add: I worked at a big pawn shop some years back. In Kansas, every thing that came in that had a serial number was run through the NCIC to see if it had been reported stolen anywhere in the US.

I've got stories you wouldn't believe .


10:20 PM  
Anonymous Eric Shelton said...

Great article, Xavier! Back when I was a young Airman at my first duty station, Offutt AFB, I found Bud's Pawn Shop right out the back gate. Bud had retired a few years back and it was being run by his son-in-law Ron, if memory serves. It was a wonderful little shop, with lots of interesting odds and ends, and always run on the up-and-up. I have a lot of fond memories of that little place.

Now here in Tucson, I haven't had such luck with the pawn shops. No concerns about honesty or anything; like you mention- local law enforcement is involved with most all transactions looking for stolen items, etc. It's more the lack of friendly folks, and I don't blame the people behind the counter. It's more the abuse they suffer from the clientele.

11:07 PM  
Blogger Jerry The Geek said...

This is an interesting article, and one which needed to be written.

I went to a pawn shop with a couple of guns ONCE. I pawned a (1918 vintage) 1911 and a late-forties Garand. I got $50 each, and reluctantly allowed them to leave my cold, dead hands.

When times were better and I went to retrieve them, I was amazed at how much it cost me.

The comment that "On a firearm, yes, you go through NICS" is dead on, but in the event it was something of a surprise to me, in real life. I couldn't believe that I had to receive permission to retrieve a gun that I already owned! (In retrospect, it's reasonable; at the time I was incensed. Like that did me a lot of good!)

So if you're considering pawning an item, just remember that you will not likely get back your pawned item for as little as you pawned it. These folks are running a business, not a rescue mission.

They will always, always, make a profit on the deal.

You, on the other hand, will lose money in the long run.

12:31 AM  
Anonymous Billy Sparks said...

My only problem with pawn shops is that firearms is a second line and as such are not as up on values and some rules. When they are asking $650 for a obviously very hard used Beretta 92FS it makes me pause. There is another pawn shop that will not let you touch a handgun unless you have a pistol permit in hand. In the state of NC you can purchase with a CCP in lieu of a permit. This store refuses to allow you to view a handgun unless you hand them your CCP. With that said I found a real nice pawn shop in the eastern part of the state, the gun counter guy knew his stuff and I enjoyed my visit.

8:07 AM  
Blogger Xavier said...

Yep, you will loose money. You are taking out a loan on your property. The pawnbroker is taking a risk that either you will be able to repay the loan, or that he can sell your collateral. The interest is compensation for that risk.

I agree, pawn shops are frequently not up on gun values, also jewelry appraisals. many just weigh and test the gold. The trick with guns is to find one still referring to a five year old Blue Book and setting prices accordingly. Some simply take their five year old Blue Book and increase the quotes by 10-15% to compensate for the time passed though.......

4:06 PM  
Anonymous andy said...

Great read, Xavier. It really made me more comfortable with the idea of pawning my guns. I was also wondering if pawn brokers factor in the extras on a gun (slings, flashlight, magazines etc). Or is it best to leave the gun stock for the exchange. I have a tricked out AR and 870 and I'd hate to take a risk on the sale and not get compensated properly. Maybe that all comes down to bartering skills, for which I have none.

6:51 PM  
Blogger Xavier said...

I wouldn't expect them to add any for accessories. Thus, I'd remove accessories. I have purchased rifles with nice scopes, removed the scopes, and sold them back for the same price.

12:05 AM  
Blogger Kevin Kunz said...

I was a regular shopper at the pawn shops around Ft Hood Tx - fantastic deals, and I still make a point to visit pawn shops every time I am near a military base. Picked up a nice flute for a neighbor's daughter, a much better instrument than they were renting from school, for $75.

I also used the pawn shops as a gun safe when I was in the Army. I had two occasions to take extended schooling, and I didn't completely trust the unit armorers to keep their hands off of my Luger and Mini-14. I know they could not take them out and fire them, but they would fondle them and that creeped me out ;)

So I pawned them for $50 each, mailed in the interest payments, and considered it a decent storage fee. This was pre-NICS, but still had to do the ATF paperwork to transfer them back when I returned from the schooling

11:04 AM  
Blogger Don Gwinn said...

Those hunters must not be practicing much. :D

9:25 PM  
Anonymous Anonymous said...

When you refer to pawn shops that are part of a chain (or franchise?), are there many of these and can you give a couple of names? Thanks.

4:56 PM  
Anonymous dave said...

Great article.

When I was living in Denver, I was a frequent pawn shop, uh, shopper. And in my experience, if you knew what you were shopping for, you had a good chance of getting fantastic deals. But, if you didn't know what you were buying, you could easily get taken for a ride.

6:55 PM  

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