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A growing number of Americans are borrowing money at an unlikely place - retail stores. Consumers are not just borrowing money on store credit cards these days. Stores are offering complex financial services from mortgages to life insurance.
"At the beginning of this year we were seeing historically low interest rates and we had heard that refinance was a great option," said Lilly Neubaur, who ended up refinancing her mortgage at Costco. "The difference that we've seen financially in our mortgage has been about $200 a month, so that's a big difference."
Neubaur is by no means alone.
"We've had over 1,000 members qualify. The average loan size is around $11,000, so that's putting over $11 million into the hands of small businesses that otherwise would not have had," said Catherine Corley of Sam's Club.
Many stores are capitalizing on the convenience of one stop shopping. At Home Depot, shoppers can get the supplies for a home remodel and finance the project under the same roof.
"We have a lot of people that come in and want to do kitchen remodels, need a new roof, need a new bathroom. The project loan allows them the opportunity to finance that project," said Brandon Hayes with Home Depot.
Experts say there is nothing wrong with borrowing at retails stores, but the convenience can lead to a rushed decision.
"They're targeting customers who are looking to complete transactions very quickly and at the point of sale, and I think in many ways that puts the onus on consumers to make sure that they're getting the best deal," said Tom Feltner of the Consumer Federation of America. "It's important for consumers to look at their own household balance sheet to determine whether or not these products are going to make sense for them.
Feltner says consumers should still shop around and read all terms and conditions carefully. Experts advise customers to always compare things like premiums, interest rates, closing costs and general fees.
In most cases, retailers are partnering with financial institutions to offer loans. That means even though loans may be targeted at less qualified borrowers, collateral will still be necessary for home equity and mortgage loans.