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Survey shows 62% of Americans oppose deferred interest plans

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  • Staff Report 

A recent WalletHub study highlights a growing concern among American consumers regarding deferred interest payment plans, with 62% advocating for their illegality. These plans, commonly offered by prominent retailers like Amazon, The Home Depot, and Best Buy, attract customers with the promise of zero interest if a purchase is paid off within a set period, such as six or twelve months.

However, the crux of the issue lies in the fine print: if even a small portion of the debt remains unpaid by the end of the promotional period, customers are charged the entire deferred interest, often at rates exceeding 30%.


This structure of deferred interest plans, as experts like Odysseas Papadimitriou from WalletHub and Chi Chi Wu from the National Consumer Law Center point out, tends to ensnare the most vulnerable consumers. While a fraction of shoppers successfully avoid interest charges, many, particularly those with lower credit scores, fall into what is seen as a financial trap.

Despite the benefits touted by organizations like the American Bankers Association for consumers needing time to make large purchases, the complicated nature and potential for substantial retroactive interest charges have led to a call for regulatory action. Critics argue that these plans are intentionally complex, misleading consumers about the accumulation and retroactive application of interest, which often results in unexpectedly high costs.



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