Ontario woman who bought $700 computer still paying it off seven years later
An Ontario woman who bought a $700 computer through a "buy now and pay later" loan is still chipping away at her debt seven years later.
Offers to "buy now and pay later" sound like a great idea and often allow you to enjoy something right away before you have to pay for it.
You can often delay payments for one to two years and financing options come in the form of a promotional offer, interest rate deferral or a revolving credit plan.
But they also come with a lot of fine print and if you miss the promotional period deadline to pay back a loan, even by a day, you could have to pay mountains of interest.
"I needed a computer for school and I didn't have the money to buy one," said Allison of Brampton, who asked us not to use her full name.
Allison said in 2014 she was attending school and needed a laptop and was told if she couldn’t pay for the computer she could finance it.
"I wasn't able to pay the full cost of the computer at the time and I was made aware that there were financing options," said Allison.
Allison said seven years ago the laptop had a purchase price of $723. She paid $23 per month for 90 months for a total of more than $2,000.
She was shocked to find out this year she still owed $397 for the computer, because she didn’t realize she signed up for a revolving loan and had mainly been paying interest charges.
"So it was quite a surprising predicament for me. I thought how is that even possible? I've paid for this computer four times already," said Allison.
CTV News Toronto reached out to the financing company and a spokesperson said "Customers that use this revolving credit take advantage of our deferred interest promotions. Most pay off their balance prior to the promotional expiration and thus avoid paying interest."
Pattie Lovett-Reid CTV News' Chief Financial Commentator said people have to be careful signing up for some deferred loans because if they miss the promotional deadline to pay back funds they could be “paying interest, on top of interest, on top of interest."
There are many different financing options including no interest charges for 12 months to two years, but if you don't pay the amount in full by the deadline you could have to pay up to 30 per cent interest over the entire loan period.
"It's often zero down no payments for a year, but a year from now you just don't know what your financial situation will be and some could find themselves in an even worse off position," said Lovett-Reid.
Before agreeing to any deferred payment plan make sure you have a good understanding of the terms and conditions. Allison didn’t, which is why she wanted to share her story to warn others.
If you sign up for a deferred payment plan make sure you write down the date when the promotional offer ends so you can pay the money back before it expires.
Always try to pay more than the minimum payment each month or the item you bought could cost you triple it's original selling price.
CTVNews.ca Top Stories
Doctors ask Liberal government to reconsider capital gains tax change
The Canadian Medical Association is asking the federal government to reconsider its proposed changes to capital gains taxation, arguing it will affect doctors' retirement savings.
Keeping these exotic pets is 'cruel' and 'dangerous,' Canadian animal advocates say
Canadian pet owners are finding companionship beyond dogs and cats. Tigers, alligators, scorpions and tarantulas are among some of the exotic pets they are keeping in private homes, which pose risks to public safety and animal welfare, advocates say.
Prince William and wife Kate thank public for birthday messages for son Louis
Prince William and his wife Kate thanked the public for their messages which had been sent to mark the sixth birthday of their youngest son Louis on Tuesday.
She was the closest she'd ever been to meeting her biological father. Then life dealt her a blow
Anne Marie Cavner was the closest she'd ever been to meeting her biological father, but then life dealt her a blow. From an unexpected loss to a host of new relationships, a DNA test changed her life, and she doesn't regret a thing.
How quietly promised law changes in the 2024 federal budget could impact your day-to-day life
The 2024 federal budget released last week includes numerous big spending promises that have garnered headlines. But, tucked into the 416-page document are also series of smaller items, such as promising to amend the law regarding infant formula and to force banks to label government rebates, that you may have missed.
Which foods have the most plastics? You may be surprised
'How much plastic will you have for dinner, sir? And you, ma'am?' While that may seem like a line from a satirical skit on Saturday Night Live, research is showing it's much too close to reality.
'Catch-and-kill' strategy to be a focus as testimony resumes in Trump hush money case
A veteran tabloid publisher was expected to return to the witness stand Tuesday in Donald Trump's historic hush money trial.
Quebec farmers have been protesting since December. Is anyone listening?
Upset about high interest rates, growing paperwork and heavy regulatory burdens, protesting farmers have become a familiar sight across Quebec since December.
South Korean sentenced to 14 months in jail for killing 76 cats
South Korean man has been sentenced to 14 months in prison for killing 76 cats in one of the country's most gruesome cases of animal cruelty in recent years.