Furnishing your home can be an exciting but expensive endeavor. Whether you're moving into a new place or looking to upgrade your existing furniture, the costs can quickly add up. This is where furniture financing comes in as a helpful solution for many shoppers. By spreading out payments over time, financing allows you to get the furniture you need now while paying for it gradually.
In this comprehensive guide, we'll explore everything you need to know about furniture financing options, how they work, and tips for choosing the best financing plan for your needs and budget. We'll cover popular financing methods like store credit cards, installment loans, lease-to-own programs, and more.
Furniture financing refers to various payment plans and credit options that allow you to purchase furniture without paying the full amount upfront. Instead, you can spread the cost over monthly payments, often with little or no interest if paid within a promotional period.
Some common types of furniture financing include:
The right financing option for you depends on factors like your credit score, budget, and how quickly you want to pay off the furniture. Many furniture retailers offer multiple financing choices to fit different customer needs.
Financing your furniture purchase can offer several advantages:
Of course, it's important to choose a financing plan you can comfortably afford and pay off in a timely manner to avoid interest charges or fees.
Let's explore some of the most common financing methods offered by furniture retailers:
Many major furniture chains offer their own store credit cards with special financing promotions. For example, the Value City Furniture credit card offers:
Store cards often have high interest rates after promotional periods end, so be sure to pay off the balance in time.
Some credit cards offer 0% APR introductory periods on purchases, allowing you to finance furniture interest-free for 12-21 months typically. This can be a good option if you have strong credit to qualify.
Furniture stores may partner with lenders to offer installment loans with fixed monthly payments. For instance, Ashley Furniture offers loans through Synchrony Bank with:
Lease-to-own plans allow you to take furniture home immediately and make rental payments, with the option to purchase at the end of the lease. Companies like Rent-A-Center specialize in this model.
Services like Affirm, Afterpay, and Klarna partner with furniture retailers to offer short-term payment plans, often with 0% interest. These can be good for smaller furniture purchases.
When evaluating financing plans, consider these key factors:
It's smart to compare offers from multiple retailers and lenders before deciding. Also be sure to read the fine print on any financing agreement.
Follow these tips to make the most of furniture financing:
With careful planning, furniture financing can be a helpful tool for furnishing your home affordably over time.
The process for obtaining furniture financing typically follows these steps:
Most furniture retailers offer instant approval for financing, allowing you to complete your purchase immediately if approved. The specific application requirements and process may vary by lender or store.
Common financing terms you may encounter include:
| Term | Definition |
|---|---|
| APR | Annual Percentage Rate - the yearly interest rate |
| Deferred Interest | Interest accrues but is waived if paid in full by deadline |
| Minimum Payment | Lowest monthly payment required |
| Promotional Period | Time frame for special financing offer |
| Pros | Cons |
|---|---|
| Get furniture immediately | Can lead to overspending |
| Spread out payments | Interest charges if not paid off in time |
| Build credit history | Potential for late fees and penalties |
| 0% interest offers available | Fees for origination, late payments etc. |
| Option | Interest Rate | Repayment Terms | Fees | Down Payment Required? | Total Cost |
| Store Credit Cards | 0% - 29.99% | 6-18 months promotional period, then variable | No fee on promo offers but can have penalties after | No typically | $X (based on purchase amount and rate) |
| 0% APR Credit Card Offers | 0% | 12-21 months typically | N/A if paid within period, else interest applies | No | $X (based on purchase amount and rate) |
| Installment Loans | 9.99% - 29.99% | 12-60 months fixed terms | Origination fees, late charges etc. | No typically | $X (based on amount borrowed and rate) |
| Lease-to-Own Programs | Rental rates vary per item | Usually 12 months, then purchase or return | No fees typically if returned | No upfront fee usually | $X (based on monthly rental rate) |
| Buy Now Pay Later Services | 0% - 29.99% | 3-12 months typically | No fees if paid in full but can have interest if late | No upfront fee usually | $X (based on amount financed and rate) |
To make the most of furniture financing, follow these best practices:
The costs associated with furniture financing depend on the local market, retailer, and financing method. Below is a sample table showing typical pricing for various financing options in USD:
| Option | Furniture Cost (USD) | Total Finance Amount (USD) | Monthly Payment (USD) | Financing Term (Months) |
|---|---|---|---|---|
| Store Credit Card - 0% APR, 18 months promo | $2,500 | $2,500 | $139.67 | 18 |
| Installment Loan - 12% APR, 48 months fixed term | $2,500 | $2,830.67* | $63.14 | 48 |
| Lease-to-Own - 9% rental rate per month, 12 months term | N/A | $2,700 | $225.00 | 12 |
| Buy Now Pay Later - 24 months at 8% APR | $2,500 | $2,674.93* | $111.45 | 24 |
*Includes interest and origination fees as applicable.
Furniture financing offers flexibility and convenience for furnishing your home over time while managing payments within a budget. By understanding the various options available, you can find a plan that fits your needs to furnish comfortably without breaking the bank.