Buy now, pay later is a line of credit that is now very popular with consumers around the UK. It is used largely on online shopping websites and it allows customers to make purchases even if they don't have the money in their bank account. Even the most popular online wallet company PayPal now has a buy now, pay later function. So why is this a favoured choice amongst customers and how does it impact your ability to get credit?
Why is buy now, pay later so popular?
Buy now, pay later is so popular simply because it gives people the chance to get what they want, while not having to worry about paying until afterwards. Before using buy now, pay later - ask yourself if you NEED the item or can you wait until you have the money? The fact that it doesn't have the word loan in the title, makes people much more likely to do it but it IS a line of credit. The APR on buy now, pay later options including online catalogues and PayPal is pretty large. Make sure that if you are using buy now, pay later options - you don't do it on too different many platforms and also ensure that you can afford the repayments. Most buy now, pay later platforms will allow you to pay back your balance with monthly installments, while others want it back in full within a certain amount of time.
How can it impact your credit score?
Using buy now, pay later is a line of credit just like any other so it will affect your credit rating. If you are only paying the minimum payment every month, this might make your credit score go down. If you are missing payments, this will definitely make your score go down and it might even have worse repercussions further down the line. This is why you really need to be aware when you are using buy now pay later because it can be really easy to get carried away. When you shop on certain websites, you will be offered this when you get to the checkout but you really need to consider if this is a good option for your current circumstances. Sometimes it is better to just stick to a standard loan if you need some quick cash. If you are looking for no guarantor loans, NowLoan can match you up with reputable lenders who can give you great deals.
Conclusion
Hopefully, you now feel a little more informed about buy now, pay later and how it all works. There is no doubt that it is growing in popularity around the world and you probably know several people who use the option of credit, or maybe you currently use it for yourself. Like with any credit, it can be beneficial provided that you can afford it. Consider going for a loan through NowLoan because this might work out to be more affordable in terms of interest.
