Is layaway a good option at holidays?


MIAMI VALLEY — According to the National Retail Federation (NRF), seven percent of consumers say the availability of layaway services is one of the most important factors in deciding where to shop. In fact, one in ten millennials say layaway services are important in their decision. But, if you don’t read the fine print, you could be dealing with extra charges. Your Better Business Bureau can help you decide if layaway is an option for you.

Layaway is an agreement between a retailer and consumer. Layaway works the opposite of a credit card: you pay in installments up front before taking the products home, rather than after the purchase. There’s sometimes a fee associated, but some retailers are revamping their layaway policies by eliminating fees. The layaway fees are small in contrast to the interest you pay on a credit card. If the transaction is not completed, the item is returned to stock and the customer’s money is returned minus a fee. Also, through layaway, the availability of the item is guaranteed by reserving the item. The item will remain at the store until the item is paid in full.

Some Internet-retailers offer layaway services for online purchases. You select merchandise online, make regular payments to the retailer and items are shipped to your home once payments are made in full.

Compare layaway plans if you choose to go this route. Your BBB offers these additional tips:

• Read the fine print. Ask for documentation of your agreement with the store.

• Make sure you know when payments are due.

• Check if a down payment is required. Typically, it is 10 to 20 percent.

• Find out how long you have to pay for the merchandise.

• Ask how long an item can be on layaway.

• Be sure to know about any extra fees, such as missed or late payments.

• Find out what happens if the item goes on sale after you start making payments.

• Inquire about layaway cancellation. Will you get your money back or in-store credit?

• Find out whether the initial fee can be refunded at the end of the layaway.

• Be sure to ask about price adjustments. These vary not only between retailers, but store by store.

• Beware some products aren’t eligible for layaway, including flammable products, tobacco, food and plants.

Remember, your BBB can provide a list of BBB Accredited Businesses to help make your shopping experience as smooth as possible. It can also provide Business Reviews on ones you’re considering. Simply visit www.bbb.org or call (937) 222-5825 or (800) 776-5301.