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COSTA RICA NEWS – Mother’s Day is around the corner, on August 15, and buying on credit is one of the options for many to purchase their gift for Mother.

Experts say the most important thing about buying on credit is to take a close look at the interest rate and terms of repayment.

Just in case you didn’t know, Mother’s Day is a big deal in Costa Rica. It is a national holiday.

The first recommendation for consumers is to look for the lowest interest rate and not the lowest repayment plan, provided the item is similar and priced competitively. A practice by many “importadoras” (retailers that claim to be direct importers) is to offer a very low payment every two weeks, coinciding with pay days, the 15th and the 30th.

These types of consumers seldom make note of the interest rate and the term of the credit, that can be up to 60, 72 or even 84 months and at rates of more than 50% annually (all legal in Costa Rica).

Penalties are another factor. That means shopping at the right store, with the right repayment plan. Not all repayment plans are the same, hidden in the fine print may be a penalty for early repayment or hefty penalties for late or missed payments. Many retailers structure their financing plans for payments to be made throughout the duration of the loan and not for early payments.

Warranty and Returns
Regardless of what the retailer may say or even put in writing at the time of the purchase, the Ministerio de Economía, Industria y Comercio (MEIC), reminds consumers that every retail purchase comes with a minimum 30 working day warranty. During this warranty period the consumer can return the defective product or if the product does not meet the claims made for repair, exchange or refund, at the discretion of the retailer.

Some retailers will offer an instant refund, while others may take up to 30 days to process. Keep the a record of the timeline of the transaction. Others will offer an exchange only if the product cannot be repaired. Repairs can take forever. Again, very important to inspect the product before leaving the store, like opening the box, plugging it in or checking for missing parts or tampering.

The MEIC is emphatic that the purchases made on credit must also apply to special pricing or offers. Many retailers will tell a customer that credit applies only to the full price and not the discounted price.

A survey by the MEIC between July 29 and August 4, of 132 retail stores, revealed that 37 were in violation with respect to their Mother’s Day offers.  Of the violations, 26 were for not informing the consumer of the price regula price of the item, in five cases the restrictions of the offer were not made clear and in four cases the offer price was applicable only to cash sales.