Borrowers beware: 'Buy now pay later' loans for everyday consumption are risky

Getting quick money to pay for daily necessities, and just pay it back later may sound good if you're in a crunch. But more than half the people who get such a loan, regret doing it later.

This is from a recent LendingTree study that has found that more people are getting quick loans as inflation is on the rise, just to get by until the next paycheck. The study found that 21% of those getting quick loans are using them to buy groceries.

Experts say it's easy to overextend with this type of loan because they are so easy to get with no credit checks involved.

Buy now, pay later loans usually require four equal installments. If payment is on time, there is no interest. If payment is late, there can be hefty late and interest fees.

Nerdwallet broke down the pros and cons of Buy now, pay later loans:

BNPL pros

• Zero-interest plans available
• No minimum credit score required
• Available at most major retailers during checkout

BNPL cons

• Some plans may charge interest
• Some plans may charge fees
• Payments may not be reported to the three main credit bureaus
• Easy to overspend
• Limited customer service options