Shoppers who fill their carts this holiday season with will likely be able to choose ” pay later ” during checkout.

Also known as BNPL, these payment plans allow you to break down your purchase into smaller, more equal installments. You can often get zero interest and pay no fees if the payments are made on time.

BNPL is a great option if you want to give more gifts. However, it is still debt and comes with some risks.

These are the five most common problems you might encounter with BNPL.

1. Repayment terms are long

BNPL plans generally follow a pay in four model. This means that your total purchase is divided by four and each payment due two weeks apart.

If your total is $200 you will pay $50 at the checkout. Each of the remaining three payments, each $50, are charged to your bank account, debit card or credit card every two weeks until you repay the loan.

Although it may seem simple, six weeks is far too long to pay off holiday purchases, according to Erik Nero (a certified financial planner) based in Gansevoort.

He says that BNPL taps into the basic human desire to have it now. However, it’s another way to seperate people from their money. It’s better to plan for and save for that gift than to spread it out over several weeks span>

Payments can be extended over several months depending on the lender. Affirm, which is a partner with Amazon and Walmart, offers terms of three, six, and twelve months, as well as its pay-in four. PayPal and Afterpay have also announced monthly payment plans with terms ranging from six months to two decades. These plans often charge interest.

Avoid it: There may be multiple BNPL options available at checkout. You can choose the shortest plan as long as you have the funds to pay the installments. This is usually a four-pay-in-four plan. You can also consider a cheaper gift that doesn’t require you break up the payments.

2. Reduce your risk of overspending

The most common concern about BNPL? It encourages excessive spending even among responsible shoppers. Because the small payments make it seem like people are spending less,

This problem is more common if you have multiple BNPL loan, which is not uncommon. NerdWallet’s recent survey on BNPL revealed that 30% of Americans used BNPL within the past 12 months. On average, these BNPL users tapped into the source of financing six more times.

Nero believes that even though the sums seem manageable on their face, they can often distract clients from larger goals.

Nero states, “I call that being twenty-dollar-ed to death.” You’re spending $20 here, $20 there, then suddenly you spend $100 in a month. But ?”

Avoid it. Stick to one BNPL Loan this Holiday Season. Reserve it for a gift that is slightly more than your holiday budget. You don’t have to sacrifice other financial goals in order to be able to afford the installments.

3. Unexpected charges

The Consumer Financial Protection Bureau’s September study found that BNPL user fees are rising.

Most of these fees are late fees. They are usually around $7 per missed payment. Sometimes, they are capped at a certain percentage of the purchase amount or payment amount.

However, there may be additional fees that vary depending on which lender you are dealing with. Zip allows you to buy now and pay later at any retailer that takes Visa cards. However, there is a $1 convenience charge per installment. Zip charges an additional $4 for every purchase.

Lenders may charge fees to reschedule a due date, or to reactivate your account after it has been disabled for missing a payment.

There may be fees charged for the transaction on the other side. Your bank might charge you an overdraft fee if your BNPL loan is tied to a debit card. If your bank loses track of your payments and your account exceeds its limit, this could result in your loan being repaid. These fees range from $30 to $35 and can even lead to your bank closing your account.

Laura Udis is senior program manager for small dollar, market and installment loans at the CFPB. Even if you are approved by the lender, make sure that you have sufficient funds in your account span>

Avoid it: Read the loan agreement carefully before you sign up for a BNPL plan. You should consider whether you are able to make the monthly payments for the term of the loan. Also, keep in mind that BNPL lenders will automatically withdraw your installments from your bank account, debit card, or credit card.

4. Tricky returns

Anybody who has ever bought merchandise for a distant relative will know how important it is that they can return the item. BNPL is a tricky way to return merchandise because you are dealing with two parties: The store where you purchased the merchandise and the lender who paid for it.

BNPL returns are handled first by the store. If the store accepts your return, the lender will be refunded for the merchandise. The lender will then issue a refund to your bank account. You may have to pay additional fees if the lender takes longer than expected.

BNPL customers have complained that some stores have difficulty accepting returns of items they have purchased. It can also be difficult to contact the customer service department of a lender if there is a dispute. Not all lenders have an easy access phone number.

Avoid it: Do not use BNPL to purchase gifts that you aren’t sure about. You can return clothing purchased for someone else if you are unsure about the color or size.

5. Reporting on negative credit

Most BNPL lenders won’t report your payment history, so you can’t use a BNPL program to improve your credit score.

Sometimes, BNPL can negatively impact your credit score, especially if you default on a loan.

Udis states that if the consumer doesn’t pay the bill, Udis will usually freeze the account to prevent the consumer from using it again. “Then there may be late fees or even debt collection depending on the BNPL firm .”

Klarna, a company that partners with retailers such as Macy’s, Bed, Bath & Beyond, and others, transfers unpaid debts after a series past-due reminders to a debt collection agency.

A debt in collection could lead to additional fees and show up on credit reports for years. This can damage your credit score, making it more difficult to get credit approval in the future.

Don’t do it: Discuss your options for hardship with the lender if you are concerned about repaying a BNPL Loan. This may include rescheduling a due day, waiving a charge, or extending the loan term.