Most people find this hard to believe, but it is true and a bunch of people fall into the trap because it seems like a smart thing to do.

What am I talking about?

• Buy-now-pay-later loans on purchases

You’ve all seen the offers for furniture, appliances, carpeting, and all sorts of other major purchases. “Buy now and pay later!”, “No payments for 24 months!”, etc….

It won’t matter what your credit scores are or what your payment history is on your credit report. Make a purchase using one of these too-good-to-be-true loans and the algorithm (formula) used by credit bureaus goes bonkers and cuts your scores by about 50 points!

I suppose it correlates a buy-now-pay-later purchase with a person that can’t control their spending or afford their purchases. Whatever the reasoning or logic built into the algorithm I recommend you stay away, far away, from any of these buy-now-pay-later deals. This includes the free credit offers from Lowes, Home Depot, and other stores that are eager to get you to spend more then you were ready to before their “great deal”.