Our Local Banks of Last Resort : Instead of tellers and loan managers, you’ve got clerks who wear guns on their hips.
“We had this Filipino guy come in and pawn his mother.”
Pardon?
“It’s true,” Gary Valkari insisted between customers at Diamond Jewelry & Loan, a pawnshop near the colorful intersection of Van Nuys and Victory boulevards. (Diamond’s is the one between the porno shop and the credit dentist who advertises “nitrous oxide gas.”)
At least the poor woman wasn’t alive. What happened, Valkari says, was this: The guy’s car runs out of gas and he has no cash. He walks in and hocks a gold chain attached to a vial that contains some of his mother’s ashes. He’s been told that losing mom’s remains is supposed to bring on bad luck, but he needs the cash. Besides, the guy boasts, he’s really not superstitious.
How Valkari got off on this tangent I can’t recall. There’s more to the story, but first, let’s let him make his original point: That pawnbrokers and the people they serve, contrary to popular belief, really aren’t agents of the underworld.
This is a common lament in the collateral loan business. When I visited Van Nuys and Victory on Monday, it wasn’t to bail a friend out of jail or get a tattoo. I had come to pick up some idea about what the pawnbrokers here thought about the uproar over a new pawnshop about to open a couple miles to the west, in a mini-mall at Victory Boulevard and Woodley Avenue.
Two neighborhood watch groups have collected 400 signatures in hopes of stopping the venture in an area already troubled by drug dealers. The fear, of course, is that the pawnshop will attract more undesirable characters--that it will play a vital role in the local drug economy, serving as a fence for the goods that junkies steal to support their habit. “That place is going to be picketed,” promises Tracy Hall, a neighborhood activist.
Cesar Salgado, the manager of Van Nuys Pawn Shop, isn’t crazy about the new pawnshop either, but not because he agrees with the activists.
“It’s competition,” he explained.
Salgado hears the complaints and says it’s unfair--another case of pawnbroker-bashing. He contends that pawnshops should be thought of as the bank of last resort--a place for people who are down on their luck and need to convert hard goods into cash. Instead of tellers and loan managers, you’ve got clerks who wear guns on their hips. Nearby sits Chester the Rottweiler, who is really very friendly . . . up to a point.
And the interest pawnbrokers charge--as controlled by state regulations--isn’t as high as most people think. Say you hock a guitar for $100; in 4 1/2 months, when the loan comes due, you either reclaim it for $121 or extend the loan by paying the $21 interest. Or your guitar gets put on the wall over by Chester.
All kinds of people use pawnshops.
A couple of years ago, Salgado says, a woman hocked her Rolls-Royce Corniche at Van Nuys Pawn Shop for $100,000. She needed the money to keep her business afloat. Sam Goren, who owns this pawnshop, displayed the vehicle in opening a new pawnshop in, of all places, Beverly Hills. Now he also owns West Valley Pawn Shop in Canoga Park, where a hocked Ferrari has been on display.
Reggie Page, a North Hollywood resident, walked in carrying a Kenwood stereo amplifier, circa 1975. Salgado remembered him from an earlier visit. “As a courtesy loan, I’ll give you ten bucks,” he said.
“Fifteen.”
Salgado held firm. Page took the $10.
“These are the shrewdest guys on the planet,” Page said. A divorce, he says, had prompted the visit. “It’s a good thing these guys are around, but it’s like a Catch-22. Once you start borrowing money, it’s hard to get the stuff out. . . . These people prey on people’s desperation.”
Like other customers, Page was thumb-printed. A copy is registered with the police. The process discourages thieves from trying to deal in stolen items with reputable pawnshops.
Emphasize the word reputable . Some pawnbrokers, Salgado acknowledges, buy goods and put them up for sale the same day, illegally bypassing police controls. “A few bad apples . . . “
But otherwise, there are many reasons to think of pawnshops--reputable ones, that is--as banks for the poor and overextended. Pawnshops really deserve to be included in any recap on recent financial history, as the roaring ‘80s crashed into the recessionary ‘90s.
Let’s start on the upper end. There’s the S & L scandal and Charles Keating and Michael Milken going off to jail. Now we’ll move down a notch. Thousands of people lose their jobs in the “downsizing” and mergers of such big institutions as Bank of America and Security Pacific.
The growth is at the bottom, which is, alas, where the customers are. As business owners struggle to make payroll, as overextended yuppies struggle for cash, as unemployment goes up, the pawnshops proliferate and make a very nice profit indeed.
Over at Diamond’s, Gary Valkari remembers when there were only three pawnshops near Van Nuys and Victory. Now there are nine. The latest was opened by a TV repairman. Come to think of it, Sam Goren owned Tip Top TV Service before he got into this racket.
As for the new pawnshop down at Woodley, Valkari says so what? As if one more will make a difference.
But what you really want to know is what happened to the guy who hocked his mom.
A few weeks later, he hobbled into the pawnshop on crutches. He’d wrecked his car. He told of nightmares featuring his dear mother. He hurriedly paid off the loan and happily put the gold chain around his neck.
The next time they saw him, he was wearing a three-piece suit. And, of course, mother.
“I’m a whole new man,” he declared. “I’ll never hock my mom again.”
Scott Harris’ column appears Tuesday, Thursday and Sunday. Readers can write to Harris at The Times Valley Edition, 20000 Prairie St., Chatsworth, Ca . 91311.
