With budgets tight, more people are turning to the Internet to trade their possessions for cash. Scott speaks to one such seller who just parted with his prized amp collection.
Scott Jagow: What do these things have in common: a 1984 corvette, a Marshall Stack amplifier from 1971, Nolan Ryan's '68 rookie baseball card?
They're all prized possessions being sold on Craigslist. Each seller has a different story, but they share a common theme: they need money to pay their bills, like food and gas.
The number of sale listings on Craigslist doubled in March compared to last year.
Ron in San Diego is the one selling the guitar amp. Ron, I understand you had a whole vintage guitar and amp collection. What did you have?
Ron: I had the 100-watt Marshall tube amp, which is like the most sought after amplifier ever, the one that Jimi Hendrix and Clapton played. I mean, you name it, anyone who's anybody's played a Marshall.
Jagow: So how did you get to the point where you're having to sell your most prized things?
Ron: Basically, I hit a negative cash flow when the real estate market crashed about two years. I'm a residential mortgage banker. I've worked for banks like Washington Mutual and World Savings, but the last lender I worked for was Washington Mutual which was for a good five years. I'm used to making six-figure income without really any effort at all to be honest with you. If I applied myself, I'd make a good quarter of a million a year and that's pretty much been the flow of things since 1999.
Jagow: So it's been good times?
Ron: Yeah, so I loaded up, was able to buy every dream amplifier I ever wanted and I started a collection. I started buying real estate as well. I bought a rental and some land.
Jagow: Right, so you've got land, you've got a great collection of guitars and amps, but what happened? Where did things go wrong?
Ron: Well, slowly, the real estate market just started deteriorating -- the mortgage meltdown, they call it. It got to the point where lenders just didn't want to lend anymore. Even when I brought loans in that met all the requirements that even their pickiness required, they still wouldn't do it. You know, they starved us to the point where they eventually laid us off and closed all the offices.
Jagow: And obviously, this decimated your personal finances?
Ron: Oh yeah. I was forced to live on my savings and when you have a mortgage of $5,000 a month and I had about $50,000 in credit cards at the time, you've got a lot of bills. Bottom line is my savings deteriorated pretty quickly, you know, having no income.
Jagow: Well I know that you've been liquidating savings, 401(k), stocks, things like that.
Jagow: How far down the line did you go before you got to the guitars and amps?
Ron: Well, once everything was gone as far as paper money like stocks, bonds, IRAs, now I'm having to resort to my physical collateral, which is my possessions really.
Jagow: Now, you've been selling mostly on Craigslist?
Ron: Yeah and eBay. I've sold all of those amps mostly on eBay to people from Japan, France. You know, it seems like a lot of the high-end amplifiers I was selling that were like... one of them was $9,800. It was for a 1966 half stack and I had to look for people outside of the U.S. for those kinds of buys. Normally, it wouldn't be a problem to sell it in the U.S., but it just seems like the money isn't really there in the U.S.
Jagow: So are you getting a fair price for your stuff?
Ron: Oh yeah. I refuse to let it go for below the market value.
Jagow: But you're up against it financially, so how long can you do that?
Ron: I've got another month before I'm forced to do something on that.
Jagow: Have you sat down and thought about how quickly things have changed here? You've gone from having all this land and making six figures to having to sell a guitar just to pay the rent.
Ron: Yeah. I saw it coming two years ago and there was nothing I could do about it. It's kind of like seeing the Titanic crash, you know. You see it, but there's nothing you can do about it. I've tried everything in my power to prevent this from happening. I even tried to set up another business and that failed. I tried to resort to my other career which was hotel management was what I did before I got into this, but it seems it's been a good 15 years since I've done that and no one will really give me a chance, you know? And the funny thing is I go and I interview and they have no respect for anyone in the mortgage business because they get so many applicants from that line of work. You know, I've lived in my car before; I'll do it again if I have to, but I'm not too concerned with anything other than just seeing, I don't know, some kind of a secure income within the next year. That's my hope.
Jagow: Well Ron, I wish you the best of luck and I hope someday soon you can build up your guitar and amp collection again.
Ron: Yes, that would be nice.
Jagow: We heard from a few people selling on Craigslist. One woman in St. Paul, Minnesota, told me she was trying to sell almost everything she owns.
She's a single mom with three kids making $7 an hour. She's had to use credit cards to put food on the table. Now, they're all maxed out. She's looking for a better job, but she can't afford to drive too far and she's had no luck selling her things, because people are looking for free stuff.