FAYETTEVILLE, Ark. (KNWA) — Many retailers offered a deferred interest plan heading into Christmas, but experts said it could create major problem for people’s credit.
Mark Foster is the Education Director for Credit Counseling of Arkansas, and he said if someone buys something that’s advertised as 0% interest, he or she should pay off the item by its contractually-stipulated dated. If not, one could be retroactively hit by interest for each month dating back to the initial purpose.
Foster said a WalletHub poll shows more than eight of every 10 people don’t know how deferred interest works.
“They see the big print: 0%, no interest, no payments,” Foster said. “But they don’t read that fine print, and they don’t know what’s coming down the line.”
Foster said the best way to protect oneself is to make on-time payments every month.