Think Hard Before Signing Up for an Electronics Buy-Back Programs
Retailers like Best Buy, Radio Shack and Walmart have buy-back programs designed to keep consumers up to date on the latest gizmos. Consumers pay an upfront fee to get into the programs, and in return, the retailer will give the consumers store credit equal to what the used gadget is worth based on its age -- the newer it is, the more money it's worth.
Under Best Buy's program, for instance, a product that a consumer has had for six months or less would get 50% of its purchase price. So a laptop that cost $1,200 would have a buy-back price of $600 within the first six months -- once the consumer has paid $49.99 to get into the program. (Check out our previously published tips on figuring out whether the Best Buy program is worth it.)"If you are an individual who likes to stay on top of the latest and greatest technology, then a buy-back program may be for you," BBB President and CEO Stephen A. Cox said in a statement. "But, as with anything else, you will need to do your research to find out if the program is worth the cost."
The BBB recommends that consumers keep some things in mind when considering a buy-back program including:
- Read the fine print and know what you're getting for your enrollment fee. Some program options can actually keep you from being able to sell back the product.
- Remember that the program will lock you into buying your next purchase from that retailer. The BBB warns you'll also end up paying triple the sales tax when all exchanges are done. Even though sales tax laws and buy-back program rule vary, the consumer is the one responsible for paying the tax -- first when you buy the gadget, a second time when you return it and then a third time when you use the gift card.
- If you're disorganized or forgetful, buy-back programs may not be for you. If you haven't saved your receipts, power cords and manuals, you could get less than expected. Most buy-back programs insist that the original items be brought back to the store at the time of the exchange.
- Mobile phone contracts are not covered.
- Remember to completely erase all personal data from the gadget, smart phone or laptop before returning it. If you don't, you could unwittingly compromise your identity.
- Consider if you could get more for your electronics elsewhere. The BBB pointed to consumers who used sites like eBay and Craigslist to sell their gadgets. In most instances, you could get more for your electronics by using these sites rather than opting for a retailer's buy-back program.
Another option is a trade-in program like the one Amazon.com has, where consumers send in items that qualify for the program -- specific items listed on Amazon -- in return for a gift card.