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- What Is Layaway?
- How Layaway Works.
- Stores With Layaway.
- What To Know About Layaway.
- Online Layaway.
It might not be as popular a concept today, but layaway was pretty big once upon a time.
During the Great Depression, an era when the economy was extremely tight, layaway made it possible for retailers to sell pricier products to cash-strapped customers. By the ’80s layaway programs were disappearing as shoppers used credit cards to fund their big-ticket purchases. However, it had a resurgence around 2008, when the economic recession made people a little more cautious with their credit cards.
Now, you can find layaway at a number of major retailers — particularly around the holidays. But layaway isn’t the right financing option for everyone. And it’s extremely rare — in fact, Walmart, which has steadily offered traditional layaway around the holidays the past several years, has ditched it in favor of partnering with buy now, pay later company Affirm.
This guide gives you everything you need to know about layaway, including how it works, important considerations and stores that offer this type of financing.
What Is Layaway?
Layaway is a payment system that lets you purchase an item over time in installments — interest-free. The store holds the item, typically in exchange for a deposit and/or small fee, until you finish making the installment payments. Once the item is paid off in full, you get to take your purchase home.
How Does Layaway Work?
Layaway programs may vary slightly from store to store, most follow the same fundamental structure. Here’s how layaway typically works:
- Step 1: Choose an item — Choose an item(s) you want to put on layaway. Some stores restrict layaway to items over a certain price or within certain departments, such as electronics, furniture and jewelry.
- Step 2: Put down a deposit and service fee — Some retailers require a certain percentage of the total purchase price, while others might allow you to choose the amount you want to put down.
- Step 3: Make incremental payments — Different stores may offer different payment scheduling options and varying lengths for their layaway programs. Depending on the program and factors like the price of your item, you may be able to make payments on a weekly, biweekly or monthly basis. Most stores require layaway purchases to be paid off in full within a year.
- Step 4: Bring home your item — After paying off your layaway purchase, you can pick it up at the store and bring it home.
Which Stores Offer Layaway in 2022?
1. Amazon
Amazon has officially become one of the latest retailers to offer a payment program for multiple categories, including furniture, electronics, home goods and more.
We’re so happy to say you can now purchase qualifying items on Amazon and pay for them over time. Amazon ships your order once it’s successfully paid off. Look for eligible items with the “Reserve with Layaway” label.
Note: Layaway is only available for items shipped and sold by Amazon and not available for shipping to Connecticut, Washington DC, Illinois, Maryland, Ohio, and Pennsylvania.
Check out the full Amazon Layaway policy.
Amazon Layaway Lowdown
| Service Fee | None |
| Down Payment | 20% |
| Cancellation Fee | None |
| Payments | Four payments over eight weeks |
| Holiday Deadline | Oct. 23 or pay for it early |
2. Army & Air Force Exchange Service
Army & Air Force Exchange Service (AAFES) is a military retailer with store locations around the world. AAFES offers affordably priced brand-name apparel, home essentials and other goodies both in stores and online. AAFES allows in-store only shoppers to put eligible purchases of $25 or more on layaway.
Check out the full AAFES layaway policy.
AAFES Layaway Lowdown
| Service Fee | $3 (non-refundable) |
| Down Payment | 15% |
| Cancellation Fee | $5 |
| Payments | 30-day layaway for all clothing, handbags and shoes 60-day layaway for all other merchandise (except jewelry) 120-day layaway for fine jewelry |
3. Best Buy
Best Buy is the go-to retailer for electronics, gaming gear and tech devices. With over 1,000 stores, shoppers have a plethora of gadget options to choose from.
Does Best Buy Have Layaway?
Yes, but not in the traditional sense. Like Big Lots, shoppers can use Progressive Leasing as a lease-to-own program. It’s a more expensive option that offers an alternative to using a credit card and doesn’t require you have credit. Progressive Leasing not available in Minnesota, New Jersey, Vermont, Wisconsin, Wyoming and Puerto Rico.
Check out the full Best Buy Progressive Leasing policies.
Best Buy Layaway Lowdown
| Service Fee | None noted |
| Down Payment | None noted |
| Cancellation Fee | None noted |
| Payments | 90 days; 12 months |
4. Big Lots
A sprawling retail chain, Big Lots sells everything from electronics and toys to home goods and household essentials. They offer two layaway options: “Price Hold” for furniture purchases only at select locations and Progressive Leasing at select stores for furniture, mattresses, grills and outdoor equipment.
Check out the full Big Lots Price Hold and Progressive Leasing policies.
Big Lots Layaway Lowdown
| Big Lots | Price Hold | Progressive Leasing |
| Service Fee | None | None noted |
| Down Payment | 10% | $49 |
| Cancellation Fee | $5 (varies by location) | None noted |
| Payments | 90 days | 90 days; 12 months |
5. Burlington Stores
In addition to coats, Burlington Stores (formerly known as Burlington Coat Factory) also offers men and women’s apparel, home goods, and beauty products. Participating Burlington Coat Factory locations offer layaway year-round.
Check out the full Burlington Store layaway policy.
Burlington Layaway Lowdown
| Service Fee | $5 in most states; $1 in Maryland |
| Down Payment | $10 or 20%, whichever is greater |
| Cancellation Fee | $10 |
| Payments | 30 days |
| Holiday Deadline | 30 days from Nov. 19 to Dec. 12 |
6. Hallmark Gold Crown
Hallmark Gold Crown is renowned for its greeting cards, but the retail chain also offers ornaments and gifts. Yes, but only from July to December. Layaway policies vary by location, so be sure to confirm the details.
Check out the full Hallmark Gold Crown layaway policy.
Hallmark Layaway Lowdown
| Service Fee | Varies |
| Down Payment | 20% |
| Cancellation Fee | None noted |
| Payments | 90 days |
7. Kmart
A subsidiary of Sears, Kmart sells everything from clothing and toys to appliances and sporting goods both online and in stores. Kmart lets you out select items on layaway in-store (although few locations still exist), online and via the app. If you miss a layaway payment, you have a seven-day grace period before your contract is canceled.
Check out the full Kmart layaway program.
Kmart Layaway Lowdown
| Kmart | 8 weeks | 12 weeks ($300+) |
| Service Fee | $5 | $10 |
| Down Payment | $10 | $10 |
| Cancellation Fee | $10 | $20 |
| Payments | Every two weeks | Every two weeks |
8. Sears
Although Sears has shut down most, if not all, locations, you can still shop the retailer online for appliances, tools, mattresses, auto and more. The Sears layaway policy is identical to the policy of its subsidiary, Kmart. If you miss a layaway payment, you have a 14-day grace period before your contract is canceled.
Check out the full Sears layaway program.
Sears Layaway Lowdown
| Sears | 8-week Contract | 12-week Contract ($300+) |
| Service Fee | $5 | $10 |
| Down Payment | $10 | $10 |
| Cancellation Fee | $10 | $20 |
| Payments | Every two weeks | Every two weeks |
9. Walmart
A big-box giant with stores around the world, Walmart hooks shoppers with everything from groceries to high-end laptops to affordable patio furniture.
Does Walmart Have Layaway?
Yes, but not in the traditional sense. Walmart offered traditional layaway through the 2020 holiday season. But as of Sept. 2021, Walmart partners with Affirm, a buy online pay later program. That means no more layaway counters. Instead, Walmart shoppers can prequalify online for the amount needed.
Check out the full Walmart Layaway policy.
Walmart Layaway Lowdown
| Service Fee | None |
| Finance Charge | 0% to 30% APR |
| Down Payment | None |
| Cancellation Fee | None |
| Payments | Three, six, 12 or 24 months |
What To Know Before You Choose Layaway
Compared to other financing methods, layaway is an appealing option because it doesn’t charge interest or impact your credit score. That said, layaway does come with its share of drawbacks. Here are six things to consider before putting something on layaway:
1. There Are (Usually) Fees Involved
Although layaway plans are usually interest-free, most retailers charge some or all of these fees:
- Service fee: In addition to a down payment, most stores will charge a service fee (usually between $5 and $15) to cover the cost of storing your item and processing multiple payments.
- Cancellation fee: If you cancel your plan or you cannot make all payments by a certain date, a retailer may charge a cancellation fee. With some stores, this could be as much as $100.
- Restocking fee: In addition to a cancellation fee, some stores might also require you to pay a restocking fee to cover the cost of returning a layaway item to the shelves.
These fees make layaway an impractical option for financing smaller purchases — for instance, if you pay a $10 service fee to put a $40 blender on layaway, you’d be tacking a whopping 25% onto the price.
2. You (Usually) Need To Put Down a Deposit
Unlike credit card purchases, layaway financing typically requires that you put down a deposit for your item. The amount a store requires for a deposit may vary by store but could be as much as 10% — a hefty chunk of change on larger purchases.
3. You Might Get Only Store Credit Back
Some retailers may refund your money in the form of original payment, but others might only offer store credit. It’s important to understand the details of each store’s layaway plan before entering into an agreement.
4. Layaway Requires Some Planning
Particularly if you need items by a certain date (say, the holidays or a birthday), layaway can require some planning ahead. For example, if you enter a 12-week layaway agreement on a Christmas present, you’ll need to place an item on layaway in early September at the latest.
5. You May Have To Comply With Strict Payment Terms
Many layaway plans include stringent payment terms. If you miss an installment — either because you forget or are unable to pay — you could lose your item. Before opting to use layaway, see if there’s a set payment schedule, or if the store has flexibility with the payoff structure. Plus, layaway has some implications when it comes to shopping during tax-free weekends — and you’ll need to follow certain rules to ensure your layaway purchases get waived sales tax.
6. You Might Miss Out on a Sale.
After placing an item on layaway, there’s always a chance it could drop in price or go on sale — particularly around the Thanksgiving season. Make sure you review the terms carefully to see if you are allowed to have a price adjustment for items on layaway.
Online Layaway: The Future of Layaway
Over the last couple of years, layaway has been making a comeback. This time, however, the time-honored payment plan has a fresh technological makeover.
Many retailers are partnering with online layaway service providers like Afterpay, QuadPay, and Klarna to let shoppers set up online installment plans. Different layaway companies offer different plans with different payment options.
Here’s a quick rundown of what the key layaway apps offer:
- Afterpay — Thousands of retailers, including Ulta, Urban Outfitters and Anthropologie use Afterpay, which lets customers set up layaway plans ranging from three to twelve months. Afterpay doesn’t charge any additional fees as long as you make your payments on time, and you are allowed to reschedule payments up to three times per year.
- Klarna — Sephora, Finish Line, Macy’s and many other retailers use Klarna to hook their shoppers up with layaway options. Klarna offers different payment options, including a few with interest.
- QuadPay — A few of the many retailers that use QuadPlay include GameStop, Amazon, Old Navy and Target. QuadPay lets you pay off purchases over four installments scheduled over a six-week period.
One key difference between online and traditional layaway? Most online layaway companies let you receive your item immediately, instead of waiting until you complete your installment payments and pay off your entire purchase.
The post Stores With Layaway and Pay Over Time Options appeared first on The Real Deal by RetailMeNot.
