Buy Now, Pay Later Shopping List and alternatives if you’ve been denied

Many readers wonder about buy now, pay later with guaranteed approval and guaranteed loans with instant approval. While there’s no such thing as a “guaranteed” loan or store credit, you can find a wide range of lenders with flexible eligibility requirements. Shoppers who prefer to avoid store credit cards could qualify for a loan, even with bad credit. In fact, there are many alternative financing methods to help you with the purchases you need.

An increasingly popular option for instant financing approval and no credit check is buy now, pay later shopping.

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Here’s everything you need to know about this loan alternative. You may not find guaranteed approval, but you can find a more relaxed solution that requires no money down and most lenders only want verify your income. Let’s jump in so you can learn more.

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Buy Now, Pay Later Purchases: What are They?

You can find “buy now, pay later” financing both in stores and online, which offers instant approval when you want to make a purchase but spread out the charges. In a physical retail store, you’re likely to find buy now, pay later electronics promotions and other larger-ticket items. Online, you can find these tools from third-party services built into a wide range of retailers that help you spread out the payments over an extended period of time.

How do you find buy now, pay later retailers?

Oftentimes, under the full price of an item, you’ll see a monthly price divided out over the course of a set period. You’ll notice the total amount is sometimes more than if you paid upfront, since you may need to pay interest for the purchase. When you choose this purchase option, you’ll enter in some basic information, such as your phone number, email address, birthday, address, and last four digits of your social security number.

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While there’s no guaranteed approval, you’ll find out within seconds whether or not you’ve been approved. In most states, you just need to be 18 years old to apply.

Generally speaking, there no deposit for buy now, pay later purchases. Once you’re approved, you simply create an online account and input your banking information. You’ll have a due date every month in which you can make a minimum payment, or more. If you continue to make these no money down purchases, your statement will be updated each month with your most recent charges, any fees you’ve accumulated, and your current balance owed.

If you want to return a product you purchased, you would work through the retailer rather than through the financing company. As long as it’s a successful return, your account would reflect the refund.

Advantages of No Credit Check Shopping

Buy now, pay later companies definitely come with both pros and cons. Here are the key benefits you could take advantage of with this payment method.

Promotional Periods
Many of these programs allow for an interest-free promotional period. Whether it’s just a few weeks or a few months, this is a good way to test out an item without worrying about when you’ll receive your refund money if it doesn’t work out. Oftentimes, you have a couple of weeks all the way up to a month before you even have to make a payment. When you live paycheck to paycheck, it can be extremely difficult to have to wait for those funds to become available in your account again, so this feature can be helpful.

You may also find a no-interest promotional period from the financing company. This can last anywhere between weeks and months. If you’re simply waiting for your next paycheck to make a purchase, buy now pay later shopping gives you flexibility with your time and money.

Credit Card Alternative
This type of shopping is also an alternative to using a credit card for your online purchases. Whether you have bad credit and can’t get a credit card or have a high balance on an existing card, buy now, pay later lets you work around this conundrum. And if you choose a service provider that only requires the last four digits of your social security number rather than the full thing, you’ll only have a soft pull performed on your credit report rather than a hard pull.

Longer Repayment Period for Larger Purchases
Another advantage of working with a buy now pay later financing company is that many allow for longer payment periods if your purchase exceeds a certain threshold. Most of these services act as a short-term loan, requiring you to pay off the full purchase amount within a certain period.

If you want to make a large purchase, that can result in high monthly payments. By choosing a company with multiple repayment tiers depending on the product price, you can better steward your funds to make your payments on time each month.

Disadvantages of No Credit Check Shopping

Despite the several benefits, buy now, pay later shopping does come with a number of consequences which should be weighed before making a purchase decision. Here’s an overview so you know what to pay attention to as you evaluate your payment options.

Interest
Just like any other type of financing, you’ll be charged interest on your purchases through buy now, pay later services. Read the terms and conditions of the financing agreement before you commit to find out when interest starts accruing and at what rate. When you have bad credit or go through a no credit check program, you’ll likely pay above average fees since you pose more of a risk to the financing company.

Account Fees
Another downside to this service is that some companies charge a monthly account fee when you carry a balance. Oftentimes this is in lieu of charging interest, but depending on how high of a balance you carry, this could be a high percentage of your purchase amount. While a monthly fee may seem low, it can equate to a high interest rate when converted into an APR.

Also consider how hefty late fees are if you miss a payment with your buy now, pay later plan. If you’re not done repaying by the term deadline, you may face other expensive fees. Be aware of these details in advance of using the financing so you have a plan for a worst-case scenario.

Account Limit
Finally, remember that most buy now, pay later plans come with a limit to the amount of purchases you can make. Like a credit card or line of credit, your limit starts to increase again as you pay off your balance. Still, be sure to stay on top of how much you owe so you know how to plan future purchases without over-extending your credit options. If you reach your limit without realizing it, you’ll be denied the next time you try to use this financing option for your next online purchase.

Credit Requirements

Credit requirements vary based on the buy now, pay later provider, though some are touted as “no credit check” programs. You may be able to avoid a credit check altogether if you sign up for autopay deductions over a short period of time. In other cases, you could just have a soft pull on your credit report.

This allows the creditor to see some information but not enough to warrant an inquiry being added to your credit report. If you sign up for ongoing monthly payments, you’ll probably have a hard credit check performed. This requires your full social security number and will appear as an inquiry for new credit on your credit report.

When you do go through a credit check, most companies don’t have an advertised minimum score. Because most operate with instant approval, you’ll be able to find out quickly whether or not you qualify for this form of financing.

Do realize, however, that ever hard inquiry you accumulate will stay on your report for two years and cause a minor drop to your score for one year. Keep this in mind each time you apply for a financing service that requests your social security number. Try to work with the same company to avoid too many inquiries accruing on your credit report. This can also serve as a red flag to other creditors when you go to apply for other types of financing, such as a mortgage, auto loan, or credit card.

Final Thoughts

While no type of financing offers guaranteed approval, there are financing options with approval requirements that are much less strict compared to others. One option is a buy now, pay later service. The most important take-away when considering this as an alternative for your purchases is to make sure you understand the true details associated with the plan.

Each one can vary substantially in terms of what type of credit check is performed, how much you can borrow, and how much you’ll end up paying over time. The last thing you want to do is lock yourself in a financial repayment plan with unexpected costs that take you by surprise.

Finally, remember never to purchase more than you can easily repay over the financing period. If you do, you’ll quickly rack up more charges and fees, making your shopping spree much more expensive than you initially planned for.

Quick Stats

Highest AmountLifeLoans - $40,000

Loan Terms up toQuickLoanLink - 7 years

Recommended income$2,000+ per month

Grace Chen
Article written by

Grace Chen

Grace Chen has 10 years of experience in the financial field and have been delivering excellent business content through her articles.

Grace graduated from the Haas School of Business, University of California and is currently the chief editor of Communicate Better where she has written and edited thousands of articles published in various media.