Having a bad credit could be a curse for many customers. They would not be able to raise loans and even secured loans like mortgages could become tough for them. Hence they may have to come back disappointed empty hand especially for catalogue items which are often available at very attractive and competitive priced. However, as competition increases and as the market becomes tougher, many online and brick and mortar retailers are ready to offer buy now and pay later options for bad credit catalogues.
This type of buying option for bad credit record holders is becoming quite common. However, even now not many customers are aware about the same. We will try and uncover the various aspects of such buying.
We hope the information provided over the next few lines will be useful for those customers who may have slipped in their credit history because of some unavoidable situations and circumstances. However, this facility has to be used selectively and carefully because there could be some pitfalls and problems associated with it.
How Does It Work As mentioned above?
This is basically open to those customers who are suffering from bad credit history. It allows them to purchase goods on credit. These are basically offered by the retailers themselves and banks and financial institutions do not come into the picture. This credit facility comes with an interest component to it.
The credit period could range from six to twelve months. It could start from six months and there are others who offer nine and twelve months facility also. There are many such catalogue offers which come with weekly repayment options. This could help you to stagger your payment much better and manage your cash flow situations quite efficiently.
Types Of Such Bad Credit Catalogue Offers
There are basically two different types of such catalogue offers.
The no credit check catalogues and bad credit catalogues.
The first one takes does not take into account the credit history of the prospective buyer. They rely more on the current financial stability of the buyer and then decide how much exposure they can take on him or her.
The second variant considers the credit history of the buyer and they might set a minimum credit score based on which they will offer their catalogue products to such persons.
The first and second options are equally good and they could certainly go a long way in helping you to rebuild your credit which might have been damaged because of reasons beyond your control.
Things You Must Be Careful About
As a customer you must be careful about a few things. You must never fail to miss out on repayments and doing so will certainly help you to build your credit quite well over a period of time.
However, there could be something working to your favor. Most of these catalogues come with a monthly minimum payment which in many cases could be as low as $10. If you are able to meet the repayment obligations regularly, the dealer or retailer might increase your credit limit gradually. Therefore you have everything to gain and nothing to lose if you are a good at repaying the credit.
You must try and always repose the faith which the retailers have placed on you. It is a win-win situation. The retailers will be able to push more catalogue products while buyers with bad credit or lack of credit history could also stand benefitted.
How Does The Application Process Work
When going in for such buy now pay later catalogue offers, there are a few things which you must always bear in mind. You should only bite as much as you can chew. In other words, if you receive your salary or income weekly, then you would do better to choose weekly repayment catalogue.
On the other hand if your income flows months, then choosing a monthly catalogue could be a better option. There could also be other repayment terms and this again would depend on the retailers who offer such facilities. Once the catalogue has been picked up, you must sign up for the personal account.
The catalogue company making such offers will ask for your name, address, date of birth and other basic information. Be accurate and honest with your information because any false reporting could lead to your name being reported to the fraud prevention service. Once the basic details have been submitted, the catalogue company will run your application through a credit check. Depending on the result of the credit check, your application may be rejected or accepted. This should not take more than a minute at the most.
What Happens If The Application Is Rejected
Should the retailer reject your application, you must be sure that your credit details are accurate and current. If it is correct, then you can give an undertaking that you will be meeting your debt obligations on time.
You should also make sure that you have the best of identification proof either by way of social security number or something else. Further you must get in touch with different credit rating agencies because they could have different credit ratings to offer.
What If Your Application Is Successful
If you are application goes through successfully, it is quite obvious that you will get a credit limit ranging from $50 to $100 which could enable you to make some catalogue purchases.
If your payment record is good you it is quite possible that the catalogue company would not mind increasing your credit record over time.
Things To Be Wary About
While all this sounds quite good, there are a few things which you must be wary about. You must be sure that you are entering into a good bargain as far as the interest rates are concerned.
Since there will be some interest charged on such catalogue purchases, you must be sure that you are not being overburdened with interest debts.
You must read through the agreements and fine print and be sure that you are not in for some rude surprises suddenly.
Hence it does call for some due diligence and researching before you actually get into the actual process of making the purchases and get into a monthly, weekly or other periodical payment obligations.