If you're considering putting your holiday gifts on layaway this year, we can help you find the best deals. In order to boost business and reward shoppers, some major retailers have reduced or even waived layaway initiation fees. Here's a rundown of the layaway policies in effect at big-box stores nationwide.
Terms and conditions: In order to set up a layaway plan at Best Buy, your total purchase must be $250 or more. You are required to make a 25% initial down payment, and pay a 5% non-refundable service fee upfront. You then make a payment every two weeks until your balance is paid in full. Go here to see sample payment breakdowns.
The bottom line: While other retailers have dropped their initiation fee, Best Buy is still charging one. To dodge a fee on electronic items, you may want to consider Sears or Wal-Mart (see these plans below) as an alternative. Best Buy has a pretty steep minimum purchase amount; go elsewhere if you want to put small-ticket items on layaway.
Burlington Coat Factory
Terms and conditions: To activate a 60-day layaway plan with Burlington Coat Factory, you have to put down a 20% deposit and pay a $5 service fee. A second payment of 20% must be made within 14 days. A cancellation fee of $5 will apply to any order. No cash refunds are given on cancelled or returned layaway items. All refunds will be in the form of a store gift card.
The bottom line: Burlington Coat Factory isn't running any special promotion for the holiday season, so the standard service fee still applies.
Sears and Kmart
Both retailers recently announced that they were dropping layaway fees altogether. The only hitch: You will be charged a steep penalty fee if you cancel your contract.
Terms and conditions: At Sears, you pay $20 or put 20% down (whichever is greater) on a layaway order. You then make four additional payments over an eight-week period. Click here to view a sample payment table. There is also an option to make in-store payments over twelve weeks on purchases of $400 or more. If you cancel a layaway order, you will have to pay a $15 fee.
Kmart requires $15 or 10% down (whichever is greater) to put merchandise on layaway. Like Sears, four payments are required over eight weeks. A 12-week, in-store payment option is available for purchases of $300 or more. A $10 cancellation fee applies to all new contracts.
The bottom line: Although waived fees are advantageous to cash-strapped consumers, the cancellation fees are much higher at Sears and Kmart than at other retailers. Be sure you can fulfill your layaway contract, or you'll lose more cash in the end.
Toys R Us and Babies R Us
Terms and conditions: Toys R Us has waived its layaway fees until October 31. Starting November 1, a $5 nonrefundable service fee is applicable to every layaway order. This program has no minimum purchase amount, but consumers must put at least 20% down, pay off at least 50% of the order within 45 days, and pay in full by December 16. A $5 cancellation fee will be charged.
The bottom line: If you're in the market for toys or baby gear, shop early and take advantage of waived fees.
TJ Maxx and Marshalls
Terms and conditions: Layaway is only offered at participating locations. In stores where layaway is available, items can be held for up to thirty days with a minimum payment of $10 or 10% (whichever is greater), and a $5 non-refundable service fee. The entire layaway order must be paid for and picked up within 30 days, or a $5 cancellation fee will be issued.
The bottom line: There's no special savings to announce here; TJ Maxx and Marshalls' layaway programs remain the same year-round.
In an attempt to entice customers with early holiday shopping, Wal-Mart extended its seasonal layaway program so that it began a month earlier. Their layaway program is in effect from Sept. 16 through Dec. 14. The store broadened its policy so that some home appliances, sporting goods and jewelry can be placed on layaway.
Terms and conditions: In order to participate in a layaway plan at Wal-Mart, your total purchase must be more than $50 and each item must be worth $15 or more. Wal-Mart is luring shoppers with a $5 "open fee" gift card, which they will receive if they fulfill the layaway contract. If you cancel your contract, Wal-Mart holds on to your $5 gift card (in lieu of an additional fee.) However, if you complete your layaway contract, you get a $5 gift card as a bonus. Customers must put $10 or 10% down (whichever is greater) to activate a layaway plan.
The bottom line: If you can meet the terms of the layaway contract, $5 in bonus cash is a nice perk.