A broken air conditioner can be an urgent, expensive problem. For Lera Pauling, the repair cost more than $2,300, so she used a buy now, pay later loan rather than paying the full amount upfront.

The offer: no interest for one year. But when Pauling saw interest listed on her account, she worried she was already being charged.

“I reached out because I was just so frustrated,” she said.

Pauling turned to the News 6 Neighborhood Network. After reviewing her loan documents, News 6 found the interest-free offer applied only if she paid off the balance within 12 months. The interest shown on her account was a reminder of what could be charged if she missed that deadline: the interest accumulated during the promotional period.

Fortunately, Pauling paid off the loan in time. But her experience points to a broader risk with buy now, pay later loans: consumers can take on several commitments before realizing how much they owe each month.

Buy now, pay later loans are short-term loans that often split a purchase into installments. Some offer zero-percent interest, making them appealing for purchases such as travel or household repairs. But Emmanuel Rivero, vice president of operations at Money Management International, said counselors are increasingly hearing about people using them for routine expenses, including groceries and other household essentials.

Rivero cited a recent survey in which nearly one-third of respondents said they used these loans for essentials. Nearly half said they needed them to make ends meet.

The loans can feel manageable because they are easy to obtain and the payments are divided into smaller amounts. But Rivero said that convenience can make it easy to take out one loan for one purchase, then another for something else — without looking at the total monthly obligation.

“By the time that they look up, they’ve got maybe three or four of these stacked on top of each other, equaling several hundreds of dollars per month in obligation,” Rivero said.

He also cautioned that some buy now, pay later loans may not appear on a credit report, making it easier for borrowers and sometimes their counselors to overlook them when assessing their debts.

What happens if you miss a payment?

The interest-free benefit may not be the whole story. Depending on the loan’s terms, a late or missed payment can mean fees, interest or, if the provider reports the account, potential effects on a borrower’s credit score. Rivero said a 30-day delinquency can affect credit whether it comes from a credit card or a buy now, pay later loan.

A survey Rivero referenced found nearly half of buy now, pay later users had been delinquent or paid late at least once. Before borrowing, read the agreement carefully and confirm whether interest is deferred and could be charged retroactively if the balance is not paid by the promotional deadline.

Rivero recommends asking yourself:

Do I already have a buy now, pay later loan? He advises against stacking a new loan on top of an existing one.

Can my budget absorb the payments? Add every installment to your monthly expenses and make a plan to pay the balance by the deadline.

Am I borrowing for a recurring essential? If you need a loan for groceries, gas or other regular expenses, take a close look at your budget and whether expenses can be reduced or income increased.

Rivero said buy now, pay later can have a useful role when a borrower understands the terms and can make every payment. The danger, he said, is letting easy approval and small installments encourage repeated borrowing.

If payments are becoming difficult to manage, Rivero recommends making a budget that includes all debts and contacting a nonprofit financial counseling agency. He said many offer free assessments to help people review their overall finances and explore options.

For Pauling, the loan is paid off — and understanding what she saw on her account brought relief.

“I thank you so much. I appreciate your time and your concern. You really make me feel a whole lot better,” she said.