loan is the gold

When economic times are tough it is generally thought that the pawnbroking industry booms--after all gold and cheap loans are tempting for credit crunchers.
Lynda Damario, regional director of Albemarle & Bond said: "There are increasing numbers of people from all walks of life who are finding themselves in a situation where the banks are unable to help so our business is growing,"
That reluctance by banks to lend has helped earn the UK's biggest pawnbroker a 47 per cent rise in profits.
At a time when the price of gold is rising in value it is probably unsurprising that sales of second hand jewellery accounted for 75pc of the firm's total sales.
Harvey & Thompson, one of Britain's biggest pawnbrokers has seen business increase by 11 per cent in recent months and said this is all due to gold--and people coming in to sell their jewellery--not from people simply pawning items.
A spokeswoman for H&T, said that consumers are more aware of the idea of selling their possessions because of the popularity of online auctions. "It's the eBay effect. People are more aware now that they can raise cash by selling things they don't need."
Pawnbrokers give customers money in return for an object which is held as security until the customer pays off the loan plus any interest charges. No credit checks are needed and, once the item is valued and a rate of interest agreed, the customer can leave with the money. Jewellery and watches are 'pledged' most often.
According to the National Pawnbrokers Association, around 88 per cent of pledged goods are redeemed. But what if the worst happens and you are unable to pay for the item at the end of the loan period?
You can usually extend the length of time of borrowing. If you cannot do this, as a last resort, the pledge will get sold off, but it is generally not in the pawnbroker's interest to do so, particularly as many of them thrive on repeat customers.
"The credit crunch isn't positive for any pawnbroker because we lend money and make money from people repaying their loans. If the credit crunch continues it won't be good for any business."