Many retailers who sell expensive items like furniture or whitegoods use promotions such as 'buy now, pay later' or 'interest free' to encourage you to buy goods that you may not otherwise have been able to afford. While these sort of arrangements are popular and can offer many short term benefits, they don't always suit everyone.
Before you make your purchase, make sure you are aware of all your rights and obligations in relation to the offer. Many consumers don't take the time to read all the terms and conditions attached to these sort of promotions and are surprised to find themselves paying huge interest rates later on that they cannot afford.
Some retailers also try to hide important details in the fine print of advertisement or sales contracts to mislead you on your repayment obligations or the real cost of the good. As with any other goods or services that you purchase, misleading and deceptive conduct is against the law.
If a low interest credit arrangement is offered to you, read all the terms and conditions carefully. By law, the business must disclose:
the nature of the 'interest-free' offer
any conditions relating to the interest free period
the annual percentage rate or rates which will apply after the 'interest-free period' has expired
when the annual percentage rate or rates will be applied from
the amount of any fees or charges that apply.
If you think you might have been misled, our page on misleading pricing can help you decide what to do and who to contact.
If your complaint relates to a financial service provider, contact the Australian Securities & Investments Commission on 1300 300 630. ASIC's consumer website, MoneySmart, provides information about credit as well as a lots of savings and investment tips.
If you are having trouble budgeting and find yourself with growing debt concerns, you might like to visit our hints for dealing with debt page.
