TRAVERSE CITY, MI -- In this economy, getting a loan is not easy.
That is why more and more people are turning to pawn shops, hoping they will play the role long held by neighborhood banks.
At Ace Buyers in Traverse City, most costumers are not looking to sell items. Instead, they are offering collateral for a short term loan.
“A majority of the customers we have do go that route...they at least plan to get their items back… and out of that...three-quarters of people are able to come back and get their item back from us,” said Lane Griffith, Ace Buyers.
Of course that loan comes with a fee.
The amount of interest fluctuates depending on the size of the loan.
“Most people are not looking for a huge cash out...they are just trying to make it through the week…maybe something is a little tight or something came up...so many people are on such a tight budget that anything unexpected can really throw a wrench in things,” Griffith said.
This trend of "pawnbrokers" has also become big business online.
Websites like Pawngo offer services similar to traditional bank lending.
Pawngo charges an interest rate of 6%. But local Pawnbrokers said most customers are willing to make that sacrifice.
