Retailers now offers Instaloans to pay for purchases

Cyber shopping season is in full swing, but have you noticed anything different at the checkout? A growing number of major retailers offer shoppers instant loans to pay for your purchases.

But how do they work? And are they better than credit cards?

An 800 dollar mattress, a 650 dollar sofa, even that vintage Louis Vuitton bag you've had your eye on.

All pretty big purchases to buy online.

Now, you can get an instant loan for any of these items right at checkout.

Affirm's Head of Marketing, Julie Ingle said, "Our first goal is to reinvent credit."

Julie Ingle is with Affirm, one of several companies that now offer the instant shopping loans also called point of sale loans.

Ingle says the payment plans are different than credit card options.

"We don't charge late fees; we don't charge deferred interest; we don't charge compounding interest. So, it's a simple interest product," Ingle said.

Each lender may be slightly different, but typically: you give basic information, decide the length of the loan -usually anywhere from three to twenty-four months and in less than a minute you'll know if you're approved.

Liz Weston said, "What we're talking about is actual installment loans where you're given an interest rate that's typically set and you're paying set payments over time."

Nerdwallet's Liz Weston says before you decide whether a loan is right for you: check out the interest rate, know who to turn to for returns, find out if there is purchase protection on purchases and if applying will ding your credit.

Ingle says her loans can actually do the opposite.

"You actually are bidding, building more history and more of a credit profile," Ingle said.

Because the company reports your on-time payments to at least one of the credit bureaus.

No matter what, Weston says, don't feel rushed. There is no line behind you at an online checkout.