When it is the end of the month and you have to repair or buy some household goods, you have a very few number of options. Suppose, your microwave blows up, you can buy the microwave oven from the catalogue on the basis of some credit. It allows you to pay back the amount over a certain period of time.
What is Catalogue credit?
Catalogue Credit is a modern manner of purchasing goods by a post normally and paying for it in the form of weekly or monthly payments. You can make the purchase by buying the catalogue on your own or taking the help from a friend, relative, or a neighbor. The third person acts as a agent in this phenomenon and earns some commission on the sale of any good through them.
Most of the times, catalogue Credit is also regarded as ‘shopping account’ or ‘mail order account’. Normally, buyers will consider their purchases as the goods bought on an account. Some of the well known companies for catalogue credit are Grattan, Freeman’s, Little woods, and K&Co (formerly known as Kays).
How Catalogue Credit works?
Many of the companies with huge catalogues offer their goods on credit. A few times, the mail order account or catalogue credit can come up without any interest until the full payment is made within the time period of three to twelve months. The company may charge interest after the time period is over. As it looks like, the interest seems to increase at a high rate making it difficult for the buyer to pay it back soon. However, there are some exceptions in the list of sellers who charge interest right from the moment catalogue credit is prepared. So, it is advisable to check the terms and conditions of the catalogue credit thoroughly before buying the goods on credit terms. Here’s a list you can trust for instant credit catalogues.
Paying back catalogue credit is similar to how it works with a bank loan. The person taking the catalogue credit has to pay back the whole amount with an interest (if there is a rate of interest) over a set period of time. This repayment period may last for a year or two depending upon the agreement between the two parties. There can be some sort of extra costs in the form of missed or late payments. Therefore, it is safe to say that the catalogue credit are not cheap in real.
Pros and Cons of Catalogue Credit
There are some pros and some cons of every thing. Same goes with catalogue credit, as there are a couple of pros as well as cons of catalogue credit which you should know before buying goods on the basis of catalogue credit. Given below are some of the pros and the cons of catalogue credit.
Pros:
- If your catalogue Credit is free of any type of interest then this means that you are getting the goods on zero credit. You may pay the whole amount in small installments without adding up the cost of an extra interest.
- There are certain items on which you cannot take a loan or use home credit. For such things, you can make the use of catalogue credit which makes it a lot easier for the buyer to purchase the useful items without worrying about the method of payment.
Cons
- Well, there may be some circumstances where you are not able to pay back the amount and which may lead you to be under a whole new debt. This may cost you more than the worth of the items you have purchased with a huge amount of interest.
- If you fail to make a payment, it affects your credit rating, and you are unlikely to get another credit any soon from the same company or any other source. The catalogue credit works like any other credit where it is mandatory for a person to make the payments on the regular basis.
- In case of any agent or a third party, their reputation and Goodwill is also on the stakes if you are not able to pay back the catalogue credit. So, to avoid making the situation awkward with your friends, relatives, or neighbors, who act as an agent for you, it is suggested to make sure there are no missed or unpaid transactions.
