Look into Layaway plans now for the Holidays!
By Steve Abel – President of the Abilene BBB | October 1, 2014
The holiday season will be here before you know it. All it takes is a little planning for the holiday season to be a bit merrier, knowing that your finances will not be strained.Common sense has many shoppers on a budget searching for more-affordable methods of paying for big-ticket items and holiday gifts. With many online and brick-and-mortar stores offering layaway services, Better Business Bureau is offering advice on how to use this payment plan in lieu of credit cards.Once considered a dated, old-fashioned method of payment, layaway services are now back in a big way.Layaway purchase plans are designed for people who want to buy products and services without using credit or paying the full price immediately.When you buy an item on credit, you take the merchandise home with you. When you use layaway, you typically put down a deposit — usually a percentage of the purchase price — and pay over time. The retailer holds the merchandise for you in reserve. You take the merchandise only when you have paid for the item in full.BBB frequently receives calls concerning layaway plans. Doing a little research on the front end can help you avoid problems later.BBB suggests you check out retailers before you do business with them at bbb.org. Some layaway sites operate like a combination shopping search engine and online shopping mart: The companies have hundreds of merchants and online retailers selling name-brand items.First, you select a product. Then you pay. Some sites require electronic debiting from your checking account; others require that you pay by check or money order through postal mail. Still others allow you to pay with credit or debit cards, or use online payment services. Once you’ve paid the balance, the online layaway service pays the merchant, and the merchant sends you the product.Some sites offer layaway plans for non-retail items such as travel, tickets to sporting events — even surgery. For example, if you’re planning a vacation to the Bahamas in six months or travel around the world or scheduling a certain medical procedure like plastic surgery in nine months, there are websites to handle your payment plan.To avoid any misunderstanding get the merchant’s layaway policy in writing. Look for details on:• The terms of the layaway plan: how much time you have to pay for the merchandise or service, when your payments are due, the minimum payment required, and possible charges for using the plan, like a service fee. Find out if there is a fee or a penalty for missed or late payments: Will your contract be canceled? Will the merchandise be returned to inventory?• The refund policy: If you decide you don’t want the merchandise after you’ve made some or all the payments, can you get a refund? Retailers’ policies may differ: Some give you all your money back; others may charge a nonrefundable service fee; still others may offer a merchant credit for the amount you paid. This information will be in the terms of the layaway plan.• Remember to keep copies of all agreements and purchases in a safe place.