Big Lots Financing: 4 Ways to Pay for Your Purchase
If you’re purchasing an item that costs $150 or more from Big Lots, you might want to spread out your payments over time. Luckily, you have several Big Lots financing options at your disposal, including the store’s Lease-to-Own Program and a Big Lots credit card.
Whether you’re shopping for furniture, electronics or another big-ticket item, here are ways to cover your next Big Lots purchase:
1. Big Lots Credit Card
Whether you’re interested in Big Lots furniture financing or another large purchase, the store offers a branded credit card as an option to cover costs. As of Dec. 20, 2021, the Big Lots Credit Card had a high APR of 29.99% variable, and the card can only be used for Big Lots purchases.
There is no annual fee, and cardholders can choose from two special financing terms:
- 0% interest on purchases of $250 or more if you pay off your account in full within six months.
- 0% interest on purchases of $750 or more if you pay off your account in full within 12 months.
If you don’t repay the balance in full within the promotional period, you’ll be charged interest from the date of the purchase.
Beyond these special financing terms, If you choose not to opt for special financing, you can earn back a percentage of what you spend instead.
To be eligible for the credit card you must:
- Be the age of majority in your state or territory
- Have a valid government-issued photo ID
- Have a valid tax identification number (SSN or SIN)
- Have a street, rural route or APO/FPO mailing address (no P.O. boxes)
APPLYING FOR THE BIG LOTS CREDIT CARD
The Big Lots Credit Card does include a credit check, so factors such as your credit history and credit score may be weighed when determining your eligibility. You can either apply online or in person by visiting a store location.
2. Progressive Leasing
If you’re looking for Big Lots financing for furniture, Progressive Leasing offers a Big Lots Lease-to-Own Program that allows you to pay for big-ticket furniture items ($150 or more) over time. Payments are automatically withdrawn from your bank account each month, and once you’ve paid for the purchase in full over a set period of time, you own it entirely.
This financing option is available at Big Lots locations that carry furniture. Qualifying items for Progressive Leasing include:
- Sofas, loveseats and sectionals
- Dining sets
- Patio furniture
- Other seasonal items
To own the item you’re leasing, you must make 12 months of payments or move forward with the early purchase option (more on that below). Although the typical lease agreement lasts 12 months, it may be offered with a longer term.
You can choose to purchase the product in full at any time. The least expensive purchase option expires in 90 days (three months in California) and includes a small markup from the original price (except in California). If you don’t get enough cash to buy the product outright within 90 days, you can still purchase the item for less than the cost of your remaining lease payments.
It’s worth noting that Progressive Leasing will cost you more in the long run than purchasing the item upfront due to included “lease-to-own costs.” While this approach can feel more affordable because it spreads payments out over time, it will cost more in the long run than paying for the item in full.
This Big Lots financing option requires no prior credit history to apply, but the company does perform a soft credit check with the three major credit bureaus. Still, it’s a viable option for bad credit furniture financing.
To be eligible, you must:
- Be at least 18 years old
- Have a checking account and provide your account information
- Provide personal information, such as your name, address and Social Security number
APPLYING FOR PROGRESSIVE LEASING
Progressive Leasing is available online or at select stores. (To find a participating store, click here.) You can start by hitting the apply button on Big Lots’ website. It will take you to its partner website to fill out your application.
If you are approved online, you can print your confirmation and take it with you to a location.
3. Paying cash
When it comes to furniture financing, paying cash will be your cheapest option overall. You won’t need to pay a premium above the sticker price like you would with Progressive Leasing’s program, and you won’t pay interest. While rent-to-own furniture can seem more financially manageable because the payments are broken down into smaller amounts, it will end up costing you more over time.
You don’t need a furniture payment plan if you take steps to put aside some money toward your future purchase each month. Consider these tips to save money for your furniture purchase:
- Set a goal for when you want to purchase the item
- Reevaluate your budget and allocate extra money toward savings
- Automate monthly deposits or use an app that deposits money into savings for you
- Put any windfalls, including monetary gifts, toward your savings goal
4. Personal loan
If you have a large upcoming purchase planned but don’t have enough funds to cover the entire amount, a personal loan may be another alternative to consider. Personal loans come with fixed interest rates and are repaid over a set period of time, usually 12 to 60 months or longer. Borrowing limits can be high, starting as low as $1,000 or more depending on the lender.
Personal loans can be secured or unsecured. A secured loan is backed by collateral, such as your car, but could offer more favorable terms, including lower fees. An unsecured loan is harder to qualify for but carries less risk to you; if you fall behind on payments, the lender has no collateral to seize.
Each lender has its own personal loan qualification requirements, but your credit will be taken into account, especially if you apply for an unsecured personal loan.
The stronger your credit score, the more personal loan options and greater access to competitive terms you’ll have. For example, LendingTree data from July 2021 revealed stark differences in interest rates based on creditworthiness. The average best APR offered to borrowers with excellent credit (760 or higher) was just 8.83%; borrowers with credit scores in the 640-679 range saw an average best APR of 22.74%.
Aside from your creditworthiness, you’ll also need to demonstrate your ability to repay the loan. Lenders may ask about:
- Your current employer
- Your income
- Existing debt obligations
- Whether you rent or own your home
If you have bad credit, a secured personal loan may be your best option. Lenders like OneMain Financial and Upgrade offer secured personal loans. Since this type of loan is less risky for the lender, it’s usually easier to obtain for bad credit furniture financing.
APPLYING FOR A PERSONAL LOAN
- Check your credit. It’s important to know where you stand in terms of your creditworthiness. This can help you estimate if a personal loan will be affordable. Request a free copy of your credit reports from the three major bureaus at AnnualCreditReport.com. Look for any errors and dispute them.
- Compare lenders. You’ll find personal loans from banks, credit unions and online lenders. Start by checking to see which personal loans you might be eligible for based on the minimum credit score required and research their average rates. This will help you narrow down your options. You should also consider the loan amounts available: For example, if you only need a $1,000 personal loan, but a loan offer requires a minimum $2,000 loan, that loan might not be the right fit for your next Big Lots purchase.
- Start the prequalification process. You’ll need to enter personal information for the lender to evaluate your eligibility. You can either prequalify on individual lenders’ websites or use a loan comparison tool. Typically, prequalification will only require a soft pull on your credit report, which won’t impact your score.
- Officially apply. Once you choose the lender that’s right for you, it’s time to apply. This will result in a hard inquiry on your credit report, which will cause a temporary dip in your score.
- Read the agreement before signing. Calculate the total cost of repayment, including fees and interest, and make sure you understand the terms.
- Make a plan for repayment. Build your monthly payment into your budget, and set up automatic payments to ensure you don’t fall behind.
5. Personal line of credit
A personal line of credit is a revolving credit line that allows you to borrow money when you need it and pay it back with interest. Interest rates are variable, but you’ll only pay interest on the money you use. This could be a good option if you’ve just moved and will need to finance multiple large purchases for your new home, for example.
However, keep in mind that a personal line of credit is unsecured and typically requires good credit. You might have an easier time obtaining a home equity line of credit (HELOC), assuming you have equity in your home. Since these lines of credit are secured, they tend to have lower interest rates.
Different lenders assess different eligibility requirements, but you’ll typically need a good or excellent credit score to use a personal line of credit for Big Lots financing. Lenders may also look at your debt-to-income ratio to ensure you have enough income to cover your debts, as well as your ongoing financial obligations. You’ll likely need to provide your employment and income information along with your Social Security number.
APPLYING FOR A PERSONAL LINE OF CREDIT
- Check your credit reports at AnnualCreditReport.com to identify any errors and see where you stand.
- Decide on an amount. This isn’t how much you need at once, but how much you’ll need on a rolling basis. If you’re going to buy a sofa and a mattress, but you plan to pay off the sofa before you tap your line of credit again, you only need enough revolving credit to cover the higher priced item.
- Research lenders. Narrow down your options to lenders that meet your needs based on your credit score and the amount you’re looking for.
- Apply for a personal line of credit. Read the agreement before signing, and make sure you understand the cost of withdrawals.
- Repay consistently. Start paying back what you borrowed as soon as possible so you can withdraw again later if you need to.
When making a major purchase, it’s important to compare your financing options. Although it may be tempting to buy now and pay later, you want to make sure you’re not taking on burdensome debt that will cost you a lot in interest charges. Before agreeing to a loan, use a personal loan calculator to crunch the numbers and make sure it’s right for you.