Avoid the risks of having multiple ‘buy now, pay later’ loans, experts explain why

Avoid the risks of having multiple ‘buy now, pay later’ loans, experts explain why

‘Buy now, pay later’ promises simple payment plans that can make financing your next purchase easy and affordable. These plans typically divide your total purchase into four equal instalments with zero interest. The first instalment is due at checkout, and the remaining three are due every two weeks until the loan is paid in full. But even a simple payment plan can turn complicated when you're juggling three or four of them at a time – a problem unique to buy now, pay later, which unlike other forms of financing, doesn't look at similar existing debts when extending an offer. While certain debts like credit cards and traditional loans are reported to credit bureaus, buy now, pay later loans typically aren't, so lenders don't know how many loans you have outstanding and can't assess your ability to afford more. With the use of ‘buy now, pay later’ plans soaring worldwide, credit experts opine how this will likely change in the coming months. Credit bureaus will soon be working to increase the visibility of ‘buy now, pay later’ on credit reports to better track the loans across lenders, while still protecting the credit scores of consumers who may be taking out