Personal Loans

Walmart Financing and Alternative Options to Consider

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When you need to make a big purchase but don’t have the money for it, sometimes you just can’t wait. Maybe you’re dealing with a flat tire or a broken-down appliance, and you need to buy a replacement ASAP. Consumers who need to make a purchase without the money saved up can utilize point-of-sale financing and credit cards from Walmart.

Walmart partners with Affirm® and Capital One® to offer point-of-sale financing and credit cards, so you can make that much-needed purchase without putting too much strain on your wallet.

Walmart’s financing options

Point-of-sale loans

Walmart partners with Affirm to offer loans to consumers at checkout. This allows customers to create a monthly payment plan for purchases ranging from $144 to $2,000. Just keep in mind certain items may not qualify, including groceries, gift cards, wireless and marketplace items.

Here’s how it works: Shop online at Walmart.com or using the Walmart app, choose Affirm at checkout and prequalify by creating an account or logging into your existing account. Once you have an account and have prequalified for a loan, you’ll get an estimate on how much you can borrow and pick a monthly payment plan that works for you.

Three-, six- and 12-month terms are available, and the annual percentage rate (APR) can range up to 30.00%, depending on your creditworthiness. You can make payments either on Affirm’s website or on the Affirm app.

Walmart’s point-of-sale loan terms
APR Up to 30.00%
Terms 3 to 12 months
Origination fee No origination fee

Walmart credit cards

Walmart partnered with Capital One to roll out two branded credit cards in September 2019, the Walmart Rewards Card and the Capital One® Walmart RewardsTM Card. The two cards are similar, but have one distinction: the Walmart Rewards Card can be used exclusively in Walmart stores and online at Walmart.com or on the app, while the Capital One® Walmart RewardsTM Card can be used anywhere Mastercard® is accepted.

These credit cards offer cash back on purchases, but that doesn’t balance out the cost of interest. If you’re looking for a long-term financing option, consider an alternative. If you put a large purchase on a Walmart credit card and can’t pay it off by the time the statement balance is due, you’ll end up paying interest (outlined in the table below).

Here’s a breakdown of the two Walmart credit cards:

Walmart Rewards Card Capital One® Walmart RewardsTM Card
Description A store credit card offered through Capital One with incentives for Walmart shoppers. It can be used exclusively at Walmart stores and online at Walmart.com or when using the Walmart app. A Capital One credit card that can be used wherever Mastercard is accepted. The rewards are structured to incentivize purchases at Walmart.
Annual fee
  • $0
  • $0
 Regular purchase APR
  • 26.99% variable
  • 17.99% - 26.99% variable
Rewards rate
  • 5% back on purchases made at Walmart.com and on the Walmart app, 2% back on Walmart purchases in stores outside of the introductory offer, and 2% back at Walmart Fuel Stations.
  • 5% back at Walmart.com & Walmart app, Grocery Pickup and Delivery, 2% at Walmart stores, Walmart & Murphy USA Fuel Stations, Restaurants & travel, 1% Everywhere else Mastercard® is accepted

 

When you’re in a spot, consider these other options

Budget accordingly leading up to your purchase

When life happens, it’s not always possible to save up for a large purchase months in advance. But if you’re able to, you should budget and pay cash instead of financing and being charged interest. Break your purchase up by dividing the total amount by the number of months you can afford to wait. It seems obvious, but here’s an example:

Let’s say you need a new vacuum, and the model you want is $200. If you can hold out for four months, you’ll need to put away $50 per month, or $25 every two weeks.

Of course, it’s not always so simple. If you need help with budgeting, try budgeting apps or a budgeting method like the 50/30/20 budget.

Open a small personal loan

A personal loan is an unsecured loan, which means it doesn’t require any collateral. These types of loans usually have fixed rates and fixed monthly payments, which makes for a predictable repayment period. The upside of personal loans is that you can use them for a number of things, ranging from a home appliance purchase to debt consolidation.

However, lenders tend to rely heavily on a borrower’s credit score, income and overall financial history for approval and to determine the loan’s terms, which may make them a less viable option for those with poor credit. For example, someone with a credit score of 760 or higher could have received an offered APR of 9.96%, according to January 2020 LendingTree data. Borrowers in the 640-679 credit band saw an average APR of 24.49%, and people with subprime credit scores will see even higher APRs.

Not all personal loan lenders offer low loan minimums. Here are a few lenders that might be a good fit to finance a small purchase.

3 lenders that offer small personal loans
Lender Borrowing limits APRs Terms
Upstart $1,000 to $50,000 7.98% to 35.99% 36 or 60 months
LendingClub $1,000 to $40,000 10.68% to 35.89% 36 or 60 months
OneMain Financial $1,500 to $20,000 18.00% to 35.99% 24 to 60 months

 

The general rule of credit cards is that you should pay off your statement balance every month to avoid paying interest. If you carry a balance long term, you’ll end up paying a premium for the item you’re financing. However, borrowers with prime credit might consider trying to secure a credit card with a 0% introductory APR, typically lasting from 12 to 18 months.

This type of financing comes with a caveat, though: If you don’t pay off the balance within the set promotional period, you could end up paying back interest to the original purchase date. Plus, these offers are typically reserved for those with good to excellent credit.

Carissa Chesanek contributed to the reporting for this article.

Michael Galvis Michael Galvis
 

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