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Pawn shop is resource in good and bad times

Security Coin and Pawn Shop ownerDennis Johnson displays one of the many pieces he has in stock March 31 in downtown Willmar. Tribune photoby Gary Miller

WILLMAR -- The shelves at Security Coin and Pawn Shop are stacked with compact discs, DVDs and computer games. There's a guitar for sale at a bargain-basement price. Gold jewelry and diamond rings twinkle beguilingly behind a glass case.

Strapped for cash these days? You can bring your treasures here, turn them into quick money and recycle them for customers looking for a deal.

In 23 years in the pawn shop business, 21 of them in Willmar, co-owner Dennis Johnson has heard many hard-luck stories from his customers.

"We've seen so many hardships and sorrows," he said.

But it's always rewarding to be able to help someone, he said. "We're someone they can trust. We've been around a long time."

Tucked into a storefront on Litchfield Avenue downtown, the pawn shop is probably one of Willmar's better-kept secrets.

Although the practice of pawning has been around for centuries (there's even a reference to it in the Old Testament), the business is often misunderstood.

"A lot of people think we just buy stuff. That's not the main thing we do," said Johnson's wife, Inez, who helps staff the store along with assistant Liz Christenson.

Johnson explains it this way: If you need money or simply want to unload some of your belongings, you can bring them to the pawn shop, obtain a short-term loan for what they're worth, and have the option of redeeming them within 90 days. If they're not reclaimed, the pawnbroker is free to sell them.

For many of the people who come through Security's doors, it's a source of ready cash to help tide them through a financial emergency or pay a bill, Johnson said. Most loans aren't large, averaging between $50 and $100.

"They need a little extra cash. They look around and find things they're able to sell," Johnson said.

Gold jewelry, old coins and even dental gold are always worth a lot. Indeed, gold and coins are what Johnson, who used to collect and sell coins as a hobby, specializes in.

"We like jewelry the best," he said. "We like gold. We like silver coins."

With gold hovering around $900 an ounce, anything gold is fetching a substantial price in the current market, he said. "That has been a big, big boost for a lot of folks."

Gaming systems, musical instruments, collectibles, guns and tools also are frequently pawned.

For some specialty things, such as antiques or unusually large or valuable diamonds, Johnson often refers the seller to a local jeweler or antique dealer, where they're likely to get the best value.

A single pawnbroker "can't be an expert in everything," he said. "I would say just about every day we have several referrals."

There's no telling what customers might bring in. One time it was a $25,000 Russian sable jacket. Another time, two piccolos were pawned in a single week, Inez Johnson remembered. "And we haven't had any since," she said.

Rapper-style gold grills, which fit over the teeth and sometimes come studded with tiny diamonds, are among the more unusual things Christenson has handled. "You never know what's going to come in," she said.

Because no mark-up is needed, pawnbrokers typically sell their merchandise at prices considerably below retail. Six years ago the Johnsons added an annex to house all the extra curiosities -- everything from glassware to old hats, leather coats and stuffed animals -- that people have brought in for them to sell.

Despite what the movies portray, stolen goods seldom show up in pawn shops. The industry in fact is highly regulated, something the Johnsons point to as a contrast with traveling auctions or online sales.

Their transactions are all reported to an automated database that's shared with local law enforcement. If someone pawns a ring, for instance, the weight, color, size, description and seller's ID are all recorded. Both state and federal laws govern how they can do business and how much interest they can charge.

In hard economic times, the national demand for pawnbroker services has been growing.

At the Willmar pawn shop, business is increasing. "I think we've seen some newer faces," Christenson said.

Last year, when gas prices soared to $4 a gallon, many people sought out the pawn shop who'd never done so before, she said.

Johnson predicts that business will remain brisk as the economy continues to struggle.

"We have a lot of folks that need money... Cash flow has been the real thing that everyone needs," he said.