What You Need To Know About Deferred Interest Plans

There are a lot of options when you're shopping for holiday gifts. But there are also some dark sides to those holiday financing offers.

Financial experts say shoppers need to watch out for and pay close attention to deferred interest deals. Deferred interest plans are typically marketed as offering zero percent introductory terms, which can save you money, especially big purchases.

But they come with a catch that makes them different from ordinary zero percent credit cards. If you have an unpaid balance of even one dollar at the end of the introductory period, or in some cases, if you miss a single payment, interest will retroactively apply to your entire original purchase amount.

"Most retailers, if you don't pay it off in full by the expiration date, are tracking that interest and accruing it. And if you don't pay it in full, they will apply it to your account," said Larry Rosebure, Christian Credit Counseling.

Cardhub found 73 percent of major retailers offer financing options for customers. Of those major retailers, 47 percent offer a deferred interest plan.

Learn more.