Avoid Layaway Gotchas - WTVM.com-Columbus, GA News Weather & Sports


Avoid Layaway Gotchas


It's back and bigger than ever! We're talking about layaway.  Retail giant Wal-Mart kicked off its program Monday after being on hiatus for several years.  It runs through December 16th and customers can put toys and electronics on layaway.

The throw back has become quite popular over the last few years with stores like K-mart, Sears and Toys R Us even expanding layaway programs.  The idea of setting cash aside versus putting it on plastic is a great money move, but believe it or not, even layaway has a catch.

Most programs require a minimum purchase and there are even fees to pay, ranging between $5 and $10 just to use the service.  Here are some questions you might want to ask before using layaway.

Is there a price per item, or total purchase requirement you have to meet?  For example at Wal-Mart, the total, minimum purchase is $50 and each item has to cost at least $15.

Do you have to make a deposit or down payment?  At K-Mart there's an up front deposit of $20 or 10% of the purchase price.  At it's sister store Sears, it's $20 or 20% of the purchase price.

Is there a service fee?  At Toys R Us, the service fee is $5.  Some retailers charge based on the length of your contract.

What happens to your merchandise if you miss a payment?  Sometimes it ends up on back on store shelves, plus you get stuck with a cancellation fee.

[Read: Layaway is hot again in 'average' holiday season]

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