So I still need moola.
I really don't want to part with my beautiful machine that's worth $2000 (not emotional worth, but street value/eBay value).
But I know I'm getting some money next month...however. But I need some money NOW.
So PawnShopOwnerGuy offers me $1000 at some not normal interest rate, and he will hold the machine as collateral. There is end date on this contract, which can be extended (at a cost to me). The machine is NOT put out for sale, but it may be put out for display.
After 2 months time I somehow come up with the extra money, then I can go back and buy back my machine by repaying the loan. With interest.
Think legal loansharking with collateral. But clearly serves a niche market. And a growing market in these tough economic times.
Now, let's say I don't have a way to get the moola together, or extend the due date.
Mr. PawnShopOwnerGuy now owns my machine. It cost him whatever he fronted me, plus the "lost" interest.
But now he can, just like in the first example, sell it immediately for $1400. And he's golden.
And you, let's say, were eyeing it on the display shelf waiting for me default or decide not to buy it back. So you've just gotten yourself a deal as well.
While they've had a really sleazy reputation, some of the owners seem to be really knowledgeable about a whole range of items/topics/merchandise.
And as a sewing machine is pretty portabl and easily sellable/saleable, I'm sure the pawn guys have seen their fair share come into the shop.
So based on all that, I'm sure that $140 is a typo. ;-)