The ins and outs of layaway

But because each retailer sets its own rules, not all layaway policies are the same. Make sure you understand all of the fees and penalties — like the ones listed here for some of the nation's biggest retailers — before you commit.

T.J. Maxx / Marshall's / A.J. Wright's
The rules: This discount clothing retailer requires a 10% deposit of your total bill in addition to a non-refundable service fee upfront. You have 30 days to pay it in full, at which time your item must be picked up. Jewelry and clearance items do not qualify. Sister companies Marshall's and A.J. Wright's have identical layaway plans.
What we think: The layaway plans are fairly typical. Not only are they fair, but they don't require a bi-weekly payment as many retailers do.

Kmart
The rules: Kmart gives you two months to fulfill a layaway contract. However, you'll have to make a payment (25% of the total) every two weeks. You'll also be required to put down a $5 service fee and a $10 cancellation fee, or 10% of the total, whichever is greater. Certain items, like cell phones and computers, cannot be put into layaway.
What we think: Kmart has the most customer-friendly layaway plan here. Plus, the store offers a variety of products, from clothes to electronics to hardware to appliances, making it a one-stop shop for layaway customers.

Sears
The rules: Only certain items like jewelry and apparel can be put on layaway. Customers have until December 23rd to pay their plan in full and Sears charges a $5 layaway fee along with a $10 fee if you cancel.
What we think: Despite being a major seller of appliances and electronics, Sear doesn't have much to offer the layaway customer. Home appliances, home electronics, computers, automotive merchandise, and consumables are just some of the items restricted from layaway. But since sister company Kmart started selling similar goods, including Sears' Craftsman and Kenmore brands, we suggest heading over to the Big K instead.

Burlington Coat Factory
The rules: Burlington offers the typical 30-day policy, but it extends it to 90 days for Baby Depot layaway purchases. But Burlington wants a 25% deposit, 25% of the total due in 14 days, $5 for a service charge, and $5 for any cancellation. It also does not refund you in cash.
What we think: Burlington Coat Factory's policy is the strictest. Not only does it require more money up front, but the company won't refund you any payments you've made in cash should you cancel. Store credit is only good if you plan to shop there again.

Walmart / Target
The rules: None, as Walmart did away with layaway in 2006, citing high costs and declining use at its stores. Target encourages consumers to go with their credit cards.
What we think: As two of the largest retailers in the country, many of Walmart and Target's customers bemoan the lack of a layaway program. But with trends showing a resurgence in layaway, maybe their policies will change.

Kohl's
The rules: Kohl's does not offer a layaway program, but its stores will hold your items for up to three days without fees.
What we think: If all you need is a very short period to scrounge up some cash, Kohl's plan is adequate. Still, it isn't a true layaway program.

Know the Law
According to the Federal Trade Commission, there aren't specific federal laws that govern layaway programs. Businesses are, however, required to adhere to two laws: The Federal Trade Commission Act, which prohibits unfair practices, and the Truth in Lending Act, which requires customers to agree to the terms of the layaway (and all other types of "loans") in writing. A reputable business offering a layaway program should help consumers understand payment obligations and avoid misunderstandings. So, before you commit, make sure you understand all the rules of a layaway plan — 10% of $100 may not be a huge penalty, but 10% of $1,000 can be a burden. For more info, head to the FTC's website.