Jewelry financing

If you’re ready to add to your collection or you’re looking to give a special piece to an extra special someone, knowing your financing options could get you better rates and make that purchase more affordable.

How can I finance jewelry?

These five financing options are a few ways people pay for pricier pieces:

1. In-store financing

Some jewelry stores partner with third-party lenders to provide financing. You pay equal installments during the loan term, which is usually between 3 and 24 months. If your credit score is good to excellent above 660, you won’t have to pay interest if you get 0% financing. But the risk with 0% financing is if you miss a payment or do not pay off the balance by the deadline, you could get stuck with a high interest rate over 30%. Also watch out for annual fees and one-time admin fees.

2. Layaway

With layaway you provide a deposit to the store, such as 20% of the purchase price, and the store will set aside the jewelry for you. You’ll have a period of weeks or months to pay it off with no interest, and once that’s done, you can pick up your jewelry. People with bad credit and no credit can qualify for layaway plans. Watch out for extra fees like restocking fee, cancellation fee and service fee.

Layaway is uncommon compared to other financing options, and not all stores will offer this.

3. Deferred plan

With deferred plans you get your jewelry now and and make no payments during the loan term except for applicable insurance premiums and taxes. However, you’ll need to pay off the balance in full before the end of the term. Otherwise, you’ll be charged interest, which can be over 30%. Like layaway, this isn’t as common.

4. Personal loans

If you’ve already shopped around and know the estimated cost of your jewelry, you can apply for jewelry financing online with a personal loan. People with good credit and bad credit can qualify for a personal loan. However, if you have bad credit, be prepared for loan offers with steep interest rates. If you can hold off for least six months, improve your credit score first.

5. Credit cards

If you can afford to make large payments each month, you might want to look into a credit card with a low APR intro period and aim to make all your payments within that intro period. Just make sure you can pay off the full balance before the intro period ends. Otherwise, you’ll be stuck paying an interest rate that’s usually much higher than those that come with personal loans. Learn more about low interest credit cards.

Representative example: Tim proposes to Lucy

Tim needs to buy an engagement ring as he is planning on proposing to his girlfriend Lucy. He has picked out the perfect ring – but it costs a whopping $4,500.00. He has $2,000.00 available to spend on a ring, so he’ll need to find a loan to cover the remaining $2,500.00. He heads online to compare personal loan lenders, and also contacts his local bank to see what they can offer him. But unfortunately, due to his poor credit, his bank won’t offer him a personal loan at all. He settles for an online lender that caters to those with bad credit – and has the $2,500.00 funds in his account by the next business day. Although his interest rate is higher than he would have liked, he realizes he can use this opportunity to make timely payments and improve his credit score.

Cost of ring	$4,500.00
Loan type	Personal loan
Loan amount	$2,500.00
Interest rate	15.00%
Loan term	1 year
Additional fees	Origination fee of 3% ($75.00)
Monthly payment	$225.65
Total loan cost	$2,782.75

*The information in this example, including rates, fees and terms, is provided as a representative transaction. The actual cost of the product may vary depending on the retailer, the product specs and other factors.

Must read: Be wary of financing companies that offer no credit check

Some financing companies offer small loans or rent-to-own agreements without checking your credit. While this may seem like a convenient option, be cautious: the interest and fees these companies charge can double or even triple the cost of the piece of jewelry you’re buying.

If this is the only type of financing you can qualify for, you might want to take steps to build your credit first and save up before buying.

How much does jewelry financing cost?

Interest and fees are the two main factors that impact the overall cost of financing a piece of jewelry:

• Interest. You can find low APR intro periods from many retailers and credit cards, but watch out: some offers might require you to pay off your entire balance within the promo period or else you’ll be charged interest for that time — all at the regular interest rate. You can compare low interest rate credit card offers here. Alternatively, if you choose a personal loan instead, you’ll make monthly payments over the length of your loan term and your APR will be determined by your eligibility.
• Fees. Each lender charges fees differently. Keep track of origination fees, prepayment penalties and late fees to ensure you’re not overspending on your loan or credit card payment.

3 situations when financing jewelry might be a good idea

Here are a few times financing an expensive piece of jewelry might be worthwhile:

• You’re looking for a long-term investment. Some items maintain their value over time, making them a solid investment piece in a long-term financial plan or as a family heirloom. Authenticated gold and diamonds from top designers tend to hold their value well.
• You found a really good deal on a good piece of jewelry. Provided your return on investment covers the cost of financing, you can turn around and sell it for a profit.
• You want to improve your credit mix. If your credit report includes multiple credit cards and closed loan accounts, financing jewelry with a personal loan can add diversity to your credit profile.

Bottom line

There are multiple financing options available to help you purchase that special piece including in-store offers, payment plans, low interest credit cards and online personal loans. Consider which option is best for you then enjoy shopping in-person or check out where you can buy jewelry online.

Learn more about how an online personal loan can help you finance jewelry even if you have bad credit.

Frequently asked questions

• Can you finance jewelry with bad credit?

  Yes, you can. You may be eligible for layaway plans and personal loans. However, be prepared for steep interest rates because lenders view bad-credit borrowers as higher risk. It's best to wait until you're in a better financial position before buying a nonessential expense.

• Does engagement ring financing work the same as other pieces of jewelry?

  Yes, you can finance an engagement ring just like any other piece of jewelry — with in-store promotions, a credit card or a personal loan.

• What credit score do I need to finance jewelry?

  To qualify for 0% financing, you'll need good to excellent credit above 660. If you have bad credit below 560, you can qualify for a personal loan from an alternative lender to pay for your jewelry.