The posh pawn shop
Oil slump execs trade in Rolexes, Ferraris & bling
THEY are often the last resort for those in need of money – but now it seems even the richest sometimes have to visit a pawn shop.
One of Scotland’s most exclusive pawnbrokers reports a rise in demand from hardup executives in Aberdeen’s struggling oil industry.
Luxury cars, expensive jewellery and valuable oil paintings are all being pawned as many are forced to liquidate their lavish lifestyles to pay the bills in the oil price slump.
Pawnbrokers offer short-term cash loans secured by an asset that can otherwise be sold to pay off the debt – and the value of some of the items pawned at Edinburgh Asset Finance is substantial.
Owner Neil Mitchinson set up the company after noticing many business owners and professionals were struggling to overcome cash-flow issues and could not get the help they needed f rom high street banks.
He does not lend less than £1,000, which means any item taken as security must be valued at more than £1,500. Items pawned recently include cars such as Bentleys and Porsches, original oil paintings and high-end jewellery.
‘We loaned against a Land Rover Freelander last week,’ said Mr Mitchinson. ‘It was for a business owner who was waiting for bills to be paid but who had more pressing things that he needed to pay.
‘Within 24 hours he was able to realise around £10,000 from his asset. It was a second car and for three or four weeks he could live without it.’
Mr Mitchinson added: ‘We tend to work on 7 per cent interest, which is applied every month, and clients can pay it off whenever they want.
‘Only 4 to 5 per cent of people last year did not reclaim their items. We are not in the business of selling, and we want everyone to get their items back so we tend to help and be as flexible as we can be.’
The upmarket pawnbroker, who has just opened a second office in the Granite City, said: ‘The increase in interest from Aberdeen wasn’t too much of a surprise really.
‘It is clearly to do with the economy up there at the moment with the oil, and a lot of people in the area have good assets that they can use. We mainly see people such as business owners who might be awaiting a payment from oil companies, or offshore contractors and people like this.’
He added: ‘ I think this is an attractive service because it is invisible.
‘ This doesn’t affect anyone’s mortgage, or future loans, and we don’t carry out background or credit checks. It’s all about the asset they bring in.
‘It’s not a cheap solution, but it’s a quick one.’