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Layaway programs: The Real Deal

It has become one of the hot holiday must-haves, for stores looking to pull people in. Many top retailers are offering layaway programs for holiday shoppers. But what’s “The Real Deal” on plans to buy now and pay later?
Syracuse (WSYR-TV) -- It has become one of the hot holiday must-haves, for stores looking to pull people in. Many top retailers are offering layaway programs for holiday shoppers. But what’s “The Real Deal” on plans to buy now and pay later?

For Donna DeStefano, holiday shopping is a lot easier when layaway is an option.

“That’s a big help in the economy as of today and we’re both retired. It does help,” she said.

The boxes are already stacked very high from people who've started their holiday shopping and using the layaway program at Kmart to do it.

"We have people that put everything on layaway all at once. They do $500 layaway, they do all of their Christmas shopping in one shot, get it done with and then its picked up in 8 to 13 weeks, you have an option over $300,” said Kmart Manager Jennifer Encarnacion Irizarry.

"Make sure it's a purchase you really want and not go overboard on it because sometimes layaway can sound easy, then you end up spending more than you thought of in the beginning,” explained Kiesha Johnson with Clearpoint Credit Counseling Solutions.

Once you’ve decided you need to get it, make sure you understand the rules of the layaway program because they can vary from store to store.

"Find out what the upfront fee is first so you know how much to expect. Second thing you want to do is find out how much of a down payment you have to put down. Third, if you decided you want to cancel find out if you can get your money back, is it cash or store credit,” Johnson continued.

Find out too if there’s a fee to cancel and what happens if you miss a payment. Many businesses will give a small grace period, but if you can’t pay, the contract is cancelled, merchandise is returned to the shelves and a fee will apply. Johnson says as long as you know the rules of your layaway plan, they can work very well, especially for people who don’t have a credit card or for people who don’t want the debt a credit card can bring.

Besides Kmart, popular retailers like Walmart, Sears, Best Buy and Toys ‘R Us offer layway programs. Target and JC Penney do not.

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