If you’re deciding between layby and buy-now-pay-later, you’ve come to the right place. In our opinion, layby is the superior choice, and we’ve discussed why in-depth. Some of the reasons why include; not being legally obligated to make future instalments, not potentially spending money that you don’t have, and being able to take advantage of sales. Read ahead if you want to know what the rest are
1. Legal Contract
When it comes to Buy-Now Pay-Later, once you make the first instalment, you are legally bound to make the rest. You might have to pay a large penalty fee otherwise, or legal action can be taken against you. This won’t be the case with layby. You don’t own a product after the first payment, which is why you only receive it after you’ve made all of your instalments.
2. Payment Fees
Buy-now-pay-later makes you pay your instalments regularly. Most of the time, this would be every month. On the other hand, laybuy payments aren’t as frequent. You can even make them a couple of months apart. This makes it a great choice for anyone who wants to buy birthday or Christmas gifts in advance.
3. Money Spending
When you buy something on BNPL basis, you potentially end up spending money that you don’t have. As mentioned, once you make the first instalment, you are legally bound to make the rest of them. This is not an issue when it comes to layby – you don’t own the product until you make the final payment.
4. Credit Score
Something that not many people realize is that when they buy on BNPL, their chances of getting a loan or credit card can be lowered. In case you’re wondering why, it’s because not making the instalments will lower your credit score. Banks need proper credit scores to approve you for a bank or credit card.
5. Advantages of Sales
If you buy on layby during a sale, you will only have to pay the discounted amount, no matter how far apart your payments are. In our opinion, this is one of the best reasons why the payment method is superior. You can use it to your advantage and shop for Christmas and birthdays months in advance, while potentially saving.
Final Thoughts
Considering all of the points that were discussed, what do you think? There are quite a few points to keep in mind when it comes to choosing between layby and BNPL. As mentioned, we would recommend layby. It is the easier of the two, and it is an all-around popular choice. Both payment methods come with their own pros and cons, as discussed.
One of the reasons why layby is superior is because your credit score won’t be affected. This is something to consider if you’re planning on buying a home soon. Also, buy-now-pay-later traps you in a legal contract that can make you pay money that you don’t have.
Hopefully, you found all of the points that were discussed useful.