Holiday shoppers beware: Signing up for instant credit could quickly turn into a jingle hell.
The truth is that understanding some credit card deals can be as tricky as trying to make a gingerbread house from scratch -- just too many ways the walls can come crashing down on you.
On the one side, you could be looking at a pretty good deal for a 0% rate.
On the other, the special, interest-free financing could collapse and the deal you get today could indeed be worthless a few months from now.
Everything, of course, can look more affordable if you can work out a deal on the spot for financing. Many consumers, particularly millennials, are more comfortable borrowing for a specific purpose, too.
Yet if you're planning to get engaged this holiday season, watch out if the jeweler suggests that you really can afford that $7,000 ring if you take out instant financing.
Ditto if you're buying a big screen TV through one of those Black Friday deals. Step back and dig deep into the details of any promotional financing.
Not all financing -- particularly when it comes to deferred interest -- works the way you'd expect.
If someone tells you that an interest-free introductory offer is good for three months or six months, you might reasonably expect that you'd pay absolutely no interest during that time frame.
You'd never expect that some slip-up suddenly could change all the rules when it comes to deferred interest so that you never get any break from the start.
"I'm completely shocked about how many people don't know about this shady practice," said WalletHub CEO Odysseas Papadimitriou.
Roughly eight in 10 consumers do not understand how deferred interest works, according a survey by WalletHub.
Here's another tip: Nearly nine in 10 store credit cards that promote interest-free introductory rates are products that involve deferred interest, according to WalletHub.
Popular retailers that offer some deferred interest programs include Apple, Amazon and Best Buy. Others that sell big ticket items, such as appliances, offer deferred interest plans in the stores, too, such as Sears, Home Depot and Lowe's, according to WalletHub.
Papadimitriou pulls no punches and frequently uses words like "bait-and-switch" or "gotcha" when he refers to interest-free financing. Some retailers might offer incentives for their sales staff to encourage you to use such financing, he said.
He says deferred interest financing is a "counter-intuitive practice that depends on predatory surprise tactics to turn a profit."
"Most bait-and-switch financing schemes were eliminated by post-Great Recession consumer protection laws," he said.
"But this one has managed to stick around -- perhaps because it only applies to retailer financing offers and is used by a long list of big-time brands that have a lot of sway in Washington."
What should shoppers keep in mind?
The idea of getting a break on financing isn't bad on the surface. And it will work for some people who take extra care making their payments and have enough money in their budget to pay off the bill in full in a set time frame.
But there are some circumstances where people can lose out and interest can build, unlike what would happen if you took out a more traditional credit card offering a 0% rate for six months.
Not knowing how the exact rules work could end up triggering $55 or more in back interest on an $800 purchase after the holidays, if you're looking at a deferred interest loan, according to WalletHub's research.
It's also important to know that a 0% introductory offer that you spot in the mail for a typical credit card doesn't have the same terms as "special financing."
We're talking about real money here where a great deal is suddenly a very bad one.
Many people don't understand that interest can easily end up being retroactive on deferred interest loans, said Chi Chi Wu, staff attorney at the National Consumer Law Center in Boston.
A 2015 report issued by the center noted that such cards had a "hidden time bomb."
"Even consumers who do understand the nature of deferred interest plans can get trapped," the report noted.
"Consumers may expect to be able to pay the balance in full by the end of the promotional period, but for a variety of reasons (such as job loss or other financial emergency) find that they cannot.
"Or, consumers may forget or miscalculate the critical date for payoff, especially if the end of the promotional period does not coincide with the payment due date for that month," the report stated.
"It's pretty deceptive," Wu said.
What triggers high-cost interest on a 0% deal?
Take extra time reading the fine print.
The Barclaycard Financing Visa offered at Apple, for example, could provide interest-free financing for six months on purchases of less than $499 if the bill is paid in full within the promo period.
Yet, "interest will be charged to your account from the purchase date if the purchase balance is not paid in full by the end of the promotional period or if you make a late payment." The annual interest rate you'd pay would be based on your creditworthiness and could be a variable rate of 15.74%, 21.74% or 28.74%.
Two triggers: You must pay off the entire bill during that promo period. And you must make payments required during that interest-free time frame.
Many times, a minimum payment is required during the "same-as-cash" period. If the minimum payment is late, the borrower might no longer qualify for a "no-interest for 12 months" type of program.
But just making the minimum payments won't be enough.
Another trip wire: "Your Apple purchase(s) may not be paid in full by the financing offer expiration date if you pay only your minimum amount due each month. You may have to make additional payments to avoid interest charges."
Not surprisingly, consumers are tricked by such complex rules.
In the past, the Consumer Financial Protection Bureau has noted that consumers have filed complaints, expressing confusion about what's a 0% rate offer for a set period of time and what's really a deferred interest plan.
Remember, paying one month's bill even a day late or owing $5 or $10 when the promotional period ends could trigger interest charges that go back to the day you bought the latest video-gaming system.
What kind of rates might you pay?
The average store credit card with a 0% introductory APR has no interest for more than 16 months.
But low rates aren't part of the picture after the promotional period ends. The average store credit card has an annual percentage rate of 28.86%, according to WalletHub.
While taking out an interest-free offer can make sense, a consumer has to be extremely disciplined about paying off that bill long before the introductory period ends.
One strategy: Set up automatic monthly payments from a bank account that has enough money to cover the bills each month.
Should you just avoid some instant financing?
While it's tempting to jump on a lot of deals during the holiday shopping rush, it could be better to walk away if you think that deferred financing could end up costing a lot in the long run. Should you avoid such deals completely?
Maybe -- if you're worried about getting tripped up.
Maybe -- if you're already having trouble paying some other bills, such as student loans or rent.
Maybe -- if you're only using special financing so that you can afford an even bigger diamond. After all, a lifetime of love and caring forever outshines any two-carat solitaire.