These 2 Surprising Cities in New York Are Among Nation’s “Pawnshop Loans Hotspots”

New York is many things... but is it really a pawn store paradise?

The holidays are right around the corner and some cash-strapped people may be looking for ways to make a quick buck.

Taking on an extra job, hustling with a side hobby, asking family for money, or hoping to win big on scratch off lottery tickets are among the most common solutions to increase cash flow.

However, others are tempted to either hit up a pawnshop to sell or put up their valuables as collateral in exchange for money.

That practice is surprisingly common in New York, according to BadCredit.org.

The financial site wanted to see for itself how people obtain finances when their money is low and one of the most common responses was taking a loan from a pawnshop.

These loans are obtained when a person temporarily pawns one of their valuables for a quick cash infusion, and then have about a month to pay it back with interest - or the shop will sell the item.

Two cities in New York rely on this method quite a lot - with one of them actually making the top 5 cities in the country that rely on pawnshop loans.

That city was Buffalo, which ranked 4th behind Atlanta, Las Vegas, and Miami, respectively.

Meanwhile, Yonkers also made the list in 20th place.

As for why both cities tend to rely on pawnshop loans,nearly half of all respondents (46%) said they resort to pawnshop loans after an unexpected expense. This can include car repairs or medical bills.

About 1 in 5 respondents said they resort to pawnshop loans in cases of financial emergencies, like job loss.

Nearly 2 out of 3 survey takers also confessed to taking out this type of loan is because they're speedy. About 70% of respondents said it's extremely important to have immediate access to the extra funds.

However, there is a caveat with pawnshop loans and it's all about their interest rates. Basically, this type of loan can charge very high fees and have strict repayment expectations.

That is why 27% of those surveyed admitted they worry about not paying back the loan and, thus, losing their collateral.

John Mcdonald, senior editor at BadCredit.org, advises that those - especially if you live in Buffalo or Yonkers - to "read the small print and try to understand what you are signing up for, and how much you'll eventually have to pay back."

Have you ever taken out a pawnshop loan? What was your experience like?

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