Layaway Now – Avoid Interest Charges Later

Nov. 14, 2011 - PRLog -- Connecticut BBB Recommends Holiday Shoppers Start Planning Now

Retailers are responding to consumers who are struggling with tight budgets and looking for ways to avoid the pain of post-holiday shopping sprees by dusting off a well-established payment plan: the layaway.

Once considered a dated, old-fashioned method of payment, layaway services are back in a big way, according to Connecticut Better Business Bureau President, Paulette Scarpetti.

“Layaway plans are an affordable way to avoid credit card interest charges and stay within a budget.”

When purchasing items on layaway, the buyer typically makes a down payment of 10 to 20 percent and pays a flat service or plan fee for the store to hold the item until it is paid off.  The customer usually has 30 to 90 days to make periodic payments to pay off the balance. Once paid off, the customer can take the items home.

As a complement to in-store layaway, some retailers offer layaway services for items purchased through its website.  In addition, third-party businesses have sprung up for the purpose of setting up layaway plans online between customers and retailers that don’t already have a layaway program.

Customers make periodic payments to the third-party layaway service provider and once the item is fully paid for, the business then buys the item from the retailer and ships it to the customer.

While layaway plans are a useful alternative to credit card purchases, it is essential that customers take note of all related terms and conditions.

When buying items on layaway, BBB advises consumers to get all of the details in writing and offers the following checklist of questions to ask:

• How much time do I have to pay off the item?

• When are the payments due?

• How much do I have to put down?

• Are there any storage or service plan fees?

• What happens if I miss a payment? Are there penalties? Does the item return to inventory?

• Can I get a refund or store credit if I no longer want the item after making a few payments?

• What happens if the item goes on sale after I’ve put it on layaway?

• Does the retailer or third-party layaway service have a good BBB rating?

To check the reliability of a company and find trustworthy businesses, visit http://www.ct.bbb.org.

# # #

Founded in 1928, Connecticut BBB is an unbiased non-profit organization that sets and upholds high standards for fair and honest business behavior. For more advice on finding companies and businesses, start your search with trust at www.bbb.org.