Did you know that it may be possible to purchase credit without actually having to obtain a credit card first? Learn how to do it!
If you have a bad credit score o no credit at all, then you will be happy to find out that there are some alternatives to make a purchase on credit without having a credit card.
Check out the options you have and take note of your future purchases without a credit card!
1. Reverse Layaway (TM) agreement
You can buy on a credit by using Reverse Layaway (TM). Bear in mind that when you sign this kind of agreement you are committing to make the payments agreed in the contract. Moreover, your payments will also need to be granted by a type of collateral, like a pre-written check.
First, you will have to find a retail or service provider that offers this type of program and complete the form. Once you sign the contract to pay as agreed, you will have to write the checks to cover each future payment.
2. Rent to own
Another option you could turn to if you don't have a credit card is to purchase merchandise on credit by renting to own it.
In this case, you will first have to find a retailer specialized in rent to own.
Unlike other options, you won't need collateral with the rent to own, but you must present proof of income, provide information about your residence and other verifiable references when you complete your application.
You can then purchase merchandise at the rent to own store. The credit limit will be determined by the store.
Regarding repayment, you can choose whether to pay weekly or monthly.
3. Closed-end credit account
These are extensions of credit with a pre-defined credit amount and with monthly payments.
This option to buy on credit without a credit card can only be used to purchase merchandise from the retailer. You can either buy online or by catalog.
You will need to complete an application and provide specific information, such as employment, income, and residence.
4. Home equity line of credit (HELOC)
This option is for those who own a home and have some equity buildup. In this case, you will be able to borrow against your home's equity with a HELOC.
This kind of credit works similarly to a credit card, as you can use it to buy items and make monthly payments at an established interest rate.
You will have to pay a visit to your bank or mortgage lender to apply for a HELOC, and you will need to draw against it by check or account card when you make a purchase.
5. Buy now pay later!
Many websites offer an alternative for those purchases on credit when you don't have a credit card: The buy now pay later option.
If you apply for this option, then the online store will give you 90 days same as cash terms. Therefore, you will make the purchase and pay for it later.