Ancient Loans

I spend a lot of time in the warehouse where we store our pawn loans (see Loan Walking), so I really can't help but notice a few things. I get to see all of the strange loans that come into the pawn shop (the most recent being a glass case housing the complete set of KISS Barbie dolls), but I also notice other things, like how some of the paper bags in which we store many smaller loan items (such as DVDs, video games, digital cameras, etc) are turning colors because they are getting that old.

After spotting these discolored bags and then looking at the loan tags (stickers stating the loan number, customer name, and date when the transaction occurred), I found a number of unbelievably old loans. There is a cheap video camera from February of 2010, an XBOX 360 from January of 2009, a microwave from June of 2008, and--get ready for this--a trumpet from July of 2007. I can't believe it. Some of the customers at the pawn shop have been paying on the same loans for coming up on four years. FOUR YEARS!

After doing a little bit of math, I have put together some rough estimates of how much these foolish customers have paid in interest on their loans thus far.

Video Camera -- $20 loan -- February 2010 -- 15 months -- $5 a month -- $75 paid in interest
XBOX 360 -- $70 loan -- January 2009 -- 28 months -- $16 a month -- $448 paid in interest
Microwave -- $10 loan -- June 2008 -- 34 months -- $5 a month -- $170 paid in interest
Trumpet -- $50 loan -- July 2007 -- 46 months -- $10 a month -- $460 paid in interest

WOW!

The interest these people have paid could have bought them a new trumpet and video camera, two new XBOX's, and three new microwaves!

I expressed my shock at how long these loans have been going on to my boss and half-jokingly asked if we ever just gave the people's stuff back after they've paid for such an ungodly length of time such as four years. And, no, we don't. We will hold onto their things for as long as they pay on their interest, until they pick it up, or until they stop paying the interest and we sell it--whether that be two days, three months, or four years.

There are a number of other loans with origins rooted in ancient pawn shop history. We currently have a crossbow in a hard case that has been on our shelf for over three and a half years, and I don't even know how old some of our jewelry loans are. I bet there are a number of very old jewelry loans since those get people more money and would subsequently cost more and be more difficult to get out.

This raises the question of what knowing this should make me feel. Amusement at the silliness of it all, guilt for being a cog in a system that relies upon financial desperation, indifference because these people knowingly enter into these contracts and keep paying their interest, pity for the futile diligence of these long-term loan holders?

I don't mean to give off the impression that the pawn shop is a heartless corporation that chews up and spits out the underprivileged. I have seen the owners and managers show generosity and get burned for doing so. I have also seen many people who were able to get through hard times because of the services we offer. It's just that there are some people (due to foolishness, bad luck, or whatever other reason) who get caught in a rut and they can't get out. And, granted, it's not our job to pull them out. This is not a charity. It is a business, yet a business that exhibits some degree of charity.

Wow. That turned serious. I'm done now. Go read one of my happier blog entries.