What you need to know about holiday layaway

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If you are considering layaway plans to help finance your holiday gift giving, the Better Business Bureau Serving Western Virginia offers some helpful tips.
Consumers often place furniture, toys and jewelry on layaway at a variety of stores, including national chain stores, local retail stores and pawn shops.
“Layaway has become increasingly popular with the challenging economic times”, said Julie Wheeler, president of the BBB. “However, putting an item on layaway may result in a loss of money if you don’t read the contract carefully.”
The BBB offers this advice:

• Pay by credit card, which comes with some buyer protections.
Charges can be disputed if the product is not delivered.

• Ask the company for a written contract for the layaway and read it carefully.
Keep in mind that each company may have a different layaway policy.

• How long can the item be on layaway?
Complaints allege consumers were not told that items could be placed on hold only a specific number of months, and then they would be returned to be sold to another consumer.

• Will the item be placed in a hold area until all payments are made?
Some consumers were informed that the product they were paying on had been sold to another consumer.

• Is there a specific date when each payment must be made?
The contract may specify when payments must be made and that, if a payment is not made by that date, the layaway item can be sold to another consumer.

• What is the company’s refund policy? Is there a restocking fee? Will only a store credit be issued? Are no refunds available?
Consumers report not being able to obtain a refund or a store credit if they change their mind about buying the layaway item. Complaints state that restocking fees of 10 percent or more are often charged.

• If the product is not in stock, will it be ordered when the layaway is opened or when the last payment is made?
Consumers report that after the last payment is made the product is not available, as it is then ordered and sometimes is delayed for weeks or months.

• What is the delivery timeframe?
Consumers report that after the last payment, delivery has been delayed due to the product not being available or other consumers having their delivery dates scheduled before layaway customers.

• Is there a fee to use the layaway program?  
If so, how much is it and is it refundable?

If you need more information, contact the BBB at (540) 342-3455 or (800) 533-5501 or see www.bbb.org.