AIRLINE travelers are being warned that ‘buy now, pay later’ deals could see them paying much more for their flights.
Point-of-sale finance deals offered by all major airlines are popular as cash-strapped customers seek to spread payments over time.
Paying on credit card could be cheaper than finance deals[/caption]
It’s easy to click these options, but convenience can come at a high cost, experts warn.
Airlines charge interest on these loans – which travelers need to pay back on top of the flight cost.
Experts warn that short-term loans – and large debts – can have a negative impact long after your flight has landed.
These short-term loans appear on your credit record.
Taking too many over a short period or having a high level of debt are warning signs to lenders.
It’s the latest example of airlines taking advantage of customers.
How do buy-now, pay later airline deals work?
When you’ve selected your flights and seats, you’re presented with several options at checkout.
You can use a credit or debit card or spread the total flight cost over a fixed number of months.
Airlines often claim no credit checks, meaning anyone can apply and be given a loan.
The debt needs to be repaid and stacking up too much can have a negative impact on your credit rating.
Far from being free, these high-cost personal loans can have hefty repayments – in some cases, much higher than those charged by credit card providers.
“The short answer is don’t do it,” said Clint Henderson, a travel expert at The Points Guy, when talking to NBC Boston.
“All the airlines offer some form of ‘buy now, pay later’ now, so they’re all getting in on the act. You know, this is free money for them.”
What’s the cheapest way to pay for flights?
The cheapest way to pay for flights is with a debit card, but only if you have cash in the bank to cover it.
If you need to use credit to pay for flights, always read the small print to ensure you’re getting the best deal.
Frequent fliers may find a travel credit card comes with some attractive options.
“You’re much better off opening a credit card that’s going to give you a statement credit and a big signup bonus,” said Henderson.
Why shopping around for flights can deliver big savings
Flight prices fluctuate, which means the same flights can cost different prices on different days or times of the year.
Experts recommend shopping around for flights.
If you know your destination, setting travel alerts can help you secure the best prices.
Airlines often offer summer deals which can also see holidaymakers slash the costs of flights, even to some of the most popular destinations in the US and abroad.
