Washington, DC -- Credit card watchdog group, is warning consumers to stay away from deferred interest credit cards this holiday season.

'You could end up paying 27 times more than you thought you would just because the offer has a tricky element to it,' says CardHub senior analyst,John Kiernan.

CardHub just released a study on the credit card offers of several big name stores, including Target, Macy's, Kohl, and Home Depot. The ones with deferred interest plans made their 'hall of shame.' The ones without--made the 'hall of fame.'

The group found several retailers with low or 0 percent interest promotions.But at the end of the offer period, consumers would pay higher rates on the original purchase price-- not just on the remaining balance.

'If you buy something for $500 and you only manage to pay down $499 of it by the time the regular rates kick in--instead of paying that regular APR on that one dollar balance you have, it goes back and applies to the original $500,' explained Kiernan.

Kiernan believes many people either don't read the fine print or are given inaccurate information when trying to find out more information on the financing policies.

In the study, CardHub called different stores under the same chain and would get different answers.

'Some had no idea what you were talking about, so you really can't take them at their word. You have to do the dirty work for yourself,' advises Kiernan.

13news notified several of the stores in the 'hall of shame' for a response.

Macy's Director of Issue Management wrote in an email, 'The deferred interest rate is fully explained on every billing statement for the customer. We have nothing more to add.'

Click here for more information on the study.

Read or Share this story: