The one time it’s OK to use BNPL<\/p>\n BNPL loans aren’t great because you can face late fees for missing a payment and unpaid debt can still get sent to collections<\/a>, Bruce McClary<\/a>, spokesperson at the National Foundation for Credit Counseling (NFCC)<\/a> points out.<\/p>\n With more than four in 10 (41%) BNPL users paying late in the past year, a LendingTree survey found<\/a>, this is an all too common risk. Yet, while risks remain, there’s actually an instance where a BNPL loan makes sense.<\/p>\n “I would say an acceptable scenario for using BNPL during holidays, or even throughout the year, is [when] you’re comfortable with the terms of the loan, [you] want to use it during a one-time situation, it fits into your budget and you can repay it at 0% interest and receive perks,” McClary says.<\/p>\n To help you check off these factors that go into the “perfect scenario,” consider the below tips from McClary:<\/p>\n Read over the BNPL terms since they aren’t universal; what one lender offers may not be what another offersEnsure the loan has zero interest, and under what circumstancesKnow any fees for late or missed paymentsCheck whether or not BNPL activity will be reported to the credit bureausMath out your repayments; BNPL full repayment is typically four to six weeksStick to a one-off situation, like purchasing a gaming console or a flat-screen TVSee if you can earn BNPL perks like cash back or rewards<\/p>\n Klarna<\/a> and Affirm<\/a> are two of the most well-known names in the BNPL space but, again, they each have their own terms that consumers should be comfortable with before signing on for a short-term loan. For instance, Klarna charges a late fee of up to $7<\/a> and interest rates can range from 0% to 35.99% APR<\/a>. Affirm doesn’t charge late fees, but late payments of more than 30 days past due may be reported to the credit bureaus<\/a>.<\/p>\n Klarna<\/a>Credit limit<\/p>\n Initial limit of $100; may be increased up to $2,500.<\/p>\n Loan terms<\/p>\n Four interest-free payments every two weeks or a one-time payment within thirty days<\/p>\n Monthly payment plan?<\/p>\n Yes, users can pay over 6 to 24 months. <\/p>\n Fees<\/p>\n Late fee of up to $7 (after 10 days)<\/p>\n Available merchants<\/p>\n Accepted at nearly 800,000 merchants, including Amazon, Best Buy, Walmart and Target. Through the Klarna card, you can buy from retailers not integrated with the company.<\/p>\n ProsNo late feesWidespread acceptanceMultiple payment optionsConsNo way to reschedule paymentsSome loans come with interest (Does not apply to Pay in 4 and Pay Later)Affirm<\/a>Interest rateCredit limitLoan termFeesAvailable merchants<\/p>\n Accepted at more than 358,000 merchants, including Amazon, Expedia, eBay, Walmart and Target.<\/p>\n ProsNo late feesWidespread acceptanceConsReports information to credit bureausNo way to reschedule paymentsSome loans come with interest3 alternatives to BNPL0% APR credit card<\/p>\n BNPL presents a heightened risk of overuse since consumers can open multiple lines of BNPL loans at once and easily fall behind on making payments without the threat of interest accruing. In fact, nearly one in four (23%) BNPL users claim to have had three or more active BNPL loans at the same time, per LendingTree<\/a>.<\/p>\n An alternative is a 0% APR card that gives you an introductory period of zero interest on all purchases for often a year or longer; you just have to make sure you have a plan to pay off your balance in full before the 0% APR period is up.<\/p>\n The no-annual-fee<\/a> Wells Fargo Active Cash\u00ae Card<\/a> offers an intro APR for 12 months on new purchases and qualifying balance transfers, plus cardholders earn an unlimited 2% cash rewards on their spending.<\/p>\n Good to Excellent670\u2013850<\/p>\n 18.74%, 24.74%, or 28.74% Variable APR<\/p>\n Earn a $200 cash rewards bonus<\/p>\n Our expert take<\/p>\n The Wells Fargo Active Cash\u00ae Card is great if you want simplicity thanks to its flat-rate 2% unlimited cash rewards on purchases and $0 annual fee.<\/p>\n Pros & consHigh flat-rate return on purchasesIntro-APR for purchases and qualifying balance transfers for a yearNo annual feeCell phone protectionHas a foreign transaction feeLimited redemption options unless you pair it with a Wells Fargo card that allows point transfersMore detailsHighlights<\/p>\n Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select’s editorial staff.<\/p>\n Apply Now to take advantage of this offer and learn more about product features, terms and conditions.Earn a $200 cash rewards bonus after spending $500 in purchases in the first 3 months.\u00a0Earn unlimited 2% cash rewards on purchases.\u00a00% intro APR for 12 months from account opening on purchases and qualifying balance transfers. 18.74%, 24.74%, or 28.74% variable APR thereafter; balance transfers made within 120 days qualify for the intro rate and fee of 3% then a BT fee of up to 5%, min: $5.\u00a0$0 annual fee.\u00a0No categories to track or remember and cash rewards don’t expire as long as your account remains open.\u00a0Find tickets to top sports and entertainment events, book travel, make dinner reservations and more with your complimentary 24\/7 Visa Signature\u00ae Concierge.\u00a0Up to $600 of cell phone protection against damage or theft.\u00a0Subject to a $25 deductible.\u00a0Balance Transfer Fee<\/p>\n 3% intro for 120 days from account opening, then up to 5%, min: $5<\/p>\n Foreign Transaction Fee<\/p>\n Another no-annual-fee card, the Chase Freedom Unlimited\u00ae<\/a>\u00a0(see\u00a0rates and fees<\/a>) has an into APR for a little over a year, 15 months, on new purchases. Cardholders earn 5% cash back on travel purchased through Chase TravelSM<\/a>, 3% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service and 1.5% on all other purchases.<\/p>\n Spotlight<\/p>\n New cardholders receive a 0% intro APR for 15 months from account opening on purchases and balance transfers.<\/p>\n Good to Excellent670\u2013850<\/p>\n Our expert take<\/p>\n The Chase Freedom Unlimited\u00ae is a no-annual-fee card that earns generous cash-back on everyday purchases and a lucrative welcome bonus.<\/p>\n Pros & consValuable welcome bonus and high rewards ratesLong intro APR for purchases and balance transfersNo annual feeHas a foreign transaction feeFew rewarding ongoing benefitsMore detailsHighlightsIntro Offer: Earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account openingEnjoy 5% cash back on travel purchased through Chase TravelSM, our premier rewards program that lets you redeem rewards for cash back, travel, gift cards and more; 3% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service, and 1.5% on all other purchases.No minimum to redeem for cash back. You can choose to receive a statement credit or direct deposit into most U.S. checking and savings accounts. Cash Back rewards do not expire as long as your account is open!Enjoy 0% Intro APR for 15 months from account opening on purchases and balance transfers, then a variable APR of 18.74% – 28.24%.No annual fee \u2013 You won’t have to pay an annual fee for all the great features that come with your Freedom Unlimited\u00ae\u00a0cardKeep tabs on your credit health, Chase Credit Journey helps you monitor your credit with free access to your latest score, alerts, and more.Member FDICBalance transfer fee<\/p>\n Intro fee of either\u00a0$5\u00a0or\u00a03%\u00a0of the amount of each transfer, whichever is greater, in the first 60 days. After that, either\u00a0$5\u00a0or\u00a05%\u00a0of the amount of each transfer, whichever is greater.<\/p>\n Foreign transaction fee<\/p>\n 3%\u00a0of each transaction in U.S. dollars<\/p>\n Personal loan<\/p>\n If you’re making a much larger purchase and need more money to cover the cost, you could consider a personal loan<\/a>. Some lenders, like PenFed<\/a>, let you borrow as little as $600; you can typically borrow as much as $100,000 with other lenders. Repayment terms can range from two to seven years, depending on the lender, and personal loan interest rates are usually lower than credit card interest rates.<\/p>\n PenFed Personal Loans<\/a>Annual Percentage Rate (APR)Loan purpose<\/p>\n Debt consolidation, home improvement, medical expenses, auto financing and more<\/p>\n Loan amountsTermsCredit neededOrigination feeEarly payoff penaltyLate feeProsCredit union membership available to anyoneLoans as low as $600Can pick up a physical at a branchMay apply with a co-borrowerConsFunds come as a physical checkMust be a member to get funds (no membership needed to apply)Must pay for expedited shipping to get your funds next dayMaximum loan amount of $50,000Late fee of $29<\/p>\n Bad credit? You can still get funding for major expenses. <\/p>\n Offers in this section are from affiliate partners and selected based on a combination of engagement, product relevance, compensation, and consistent availability.<\/p>\n Annual Percentage Rate (APR)<\/p>\n Savings<\/p>\n While it may be a little too late to create a sinking fund<\/a> specifically for holiday shopping this year, remember this tip for next year. Socking away small amounts of money throughout the year will make holiday spending much less financially overwhelming since you’ve already created a pile of dedicated savings to it.<\/p>\n This way, you don’t have to apply for new lines of credit at all. Or, at the very least, the savings can offset the amount of credit you’d need to power through your holiday shopping list.<\/p>\n Should you use BNPL?<\/p>\n While BNPL loans can make payments more manageable without charging interest, they shouldn’t become your default way of making purchases. It can be tempting to take out multiple BNPL loans at the same time, and some people may even think of BNPL as an extension of their income.<\/p>\n Don’t use BNPL if you aren’t sure you can make all of the payments on time. BNPL loans are short-term loans and usually need to be repaid fully within four to six weeks.<\/p>\n It’s also generally recommended to not use BNPL on impulse purchases.<\/p>\n Subscribe to the CNBC Select Newsletter!<\/p>\n Money matters \u2014 so make the most of it. Get expert tips, strategies, news and everything else you need to maximize your money, right to your inbox.\u00a0Sign up here<\/a>.<\/p>\n Why trust CNBC Select?<\/p>\n![\"\"](\"https:\/\/www.newsbeep.com\/us\/wp-content\/uploads\/2025\/11\/image_58.png\")
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