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Store finance debt arrears. How to deal with them.

Store finance is a common way to pay for items and pay back in instalments.

This type of credit is often referred to as ‘buy now pay later’ credit, which has grown in popularity in recent years due to providers such as Klarna and Clearpay.

Interest-free credit is offered by many major high street stores and online retailers and is often available interest free (0% APR) for a fixed time. This means you won’t pay any interest if you pay the loan back in full before this period runs out.

Store finance is regulated by the Consumer Credit Act and most agreements are a type of unsecured personal loan. This means you’re the legal owner of the goods straight away, and the retailer can’t take the goods back if you miss payments.

Are you in control of your repayments? Find out with our 60-second repayment checker.

Before taking out a ‘buy now pay later’ loan it’s important to work out whether you can afford to repay the debt during the interest-free period. Check the terms and conditions of the loan for any early repayment charges and make sure you can afford any interest payments if you can’t pay the loan back during the interest free period.

Store cards and persistent debt

If you’ve been making minimum payments on your store card for a while, you may have recently received a letter telling you that your account is in 'persistent debt'. They may have asked you to increase your monthly payment. Find out more about persistent debt

If you need help dealing with letters about persistent debt, we can help

Please call our dedicated team of advisors on 0300 303 2517, Monday – Friday 9am - 5pm.

Weekly payments stores and rent-to-own

Some weekly payment stores such as Brighthouse, Perfect Home or Buy As You View offer a different type of higher-interest finance agreement. For these stores, you don’t own the goods until the last payment is made, and they can take the goods back if you don’t pay.

If you’re not sure what type of finance you have, check the credit agreement you signed with the store. If it says ‘fixed sum loan agreement’ at the top, the goods are yours straight away. If it says ‘hire purchase’ or ‘conditional sale’, the goods belong to the retailer until you’ve made the last payment.

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What happens when the interest-free period ends?

If you don’t pay the loan back during the interest free period, further payments will be needed until you’ve paid the loan. These payments will have interest added to them, which could make the loan unaffordable as the rates are often high, typically 20-30% APR.

What if I can’t afford the loan or fall behind?

If you’re struggling to pay your loan back or miss payments your account will go into arrears. The creditor will contact you to discuss the missing payments and ask you to catch up with the payments.

If you don’t make the repayments the account will default and the creditor can take further action such as passing the debt to a collection agency or taking court action.

If you’ve taken out a’ buy now pay later’ loan and can’t afford to pay it or you’ve fallen behind we can help. Contact us to speak to an advisor or use our online debt advice tool.

60-second repayment checker

Answer 5 quick questions to find out.

It shouldn’t take more than a minute to get a clear picture of whether you’re on top of your credit card, store card and catalogue repayments or not.

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Did you pay only the minimum payment last month?


Do you regularly pay only the minimum payment?


Have you had any letters warning you that you're in 'persistent debt'?


Do you ever miss payments to your credit card, store card or catalogue accounts?


Do you worry about not being able to keep up with repayments or not being in control of your credit?

You're in control

Based on your answers it sounds like you’re in control of your repayments.

Because you’re not missing any payments and you’re not just paying the minimum each month, you’re reducing your balance. You’re also saving money by not paying interest.

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Things are OK

Based on your answers, it sounds as though you’re mostly keeping on top of your repayments at the moment.

That’s great. By paying more than the minimum payment each month, you reduce your credit card balance quicker and you can also save yourself money because you’ll pay less in interest.

Find out more about what can happen if you’re only making minimum payments by clicking the button below.

Find out more

You appear to be struggling a bit

Based on your answers, it looks like you’re struggling to keep on top of repayments and your lenders may contact you to ask you to pay more.

Find out what to do now

We’ve got a specialist team who can help you. Please call us on 0300 303 2517. We’re open Mon-Fri, 9am-5pm.

You need debt help

Based on your answers, it looks like you’re struggling financially. We can help you out. We’d recommend you get in touch with us for free debt advice.

Use our online debt advice tool for tailored budgeting advice and a personal action plan.

Get debt help now

If you’d like to talk to a debt advisor, please call us on 0800 138 1111. We’re open Mon-Fri, 8am-8pm, Sat 8am-4pm.

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