The Hidden Cost of Buy Now, Pay Later — Even If You Always Pay On Time

Buy Now, Pay Later (BNPL) services like Afterpay, Zip, Klarna and others have quickly become a go-to for everyday spending. They promise no interest, flexible instalments, and instant gratification — all wrapped in a slick app that feels more like a shopping buddy than a financial product.

But here’s the truth: even if you never miss a single payment, BNPL can quietly derail your financial health. And for women who are planning to buy property or build long-term wealth, the impact can be far greater than most realise.

Let’s explore the real cost of BNPL — the part that’s hiding behind the “four easy payments” tagline.

It Can Lower Your Borrowing Power

When you apply for a home loan, lenders don’t just look at your income — they also look at your expenses and financial commitments. Regular BNPL use, even with perfect repayment history, can be treated as an ongoing liability, much like a car loan or credit card.

Imagine you spend around $400 a month through BNPL services. Over a typical lender assessment period of three years, that’s $14,400 in perceived financial obligation. Depending on your income and debts, this alone could reduce your borrowing capacity by $20,000 to $50,000 — or more. For some buyers, that could be the difference between getting into the market… or staying stuck on the sidelines.

It Messes with Your Cashflow (Even if You Don’t Notice)

One of the most overlooked impacts of BNPL is the way it disrupts your budgeting rhythm. Let’s say you make three Afterpay purchases in a month, totalling $600. Spread across four instalments, that’s $75 per fortnight for each one — or $225 coming out every fortnight, often at different times.

Because the deductions happen automatically and are staggered, you’re often left trying to track when money is coming out, what it’s for, and whether there will be enough left for other essentials. Even if you’re not falling behind, the mental load of managing this “drip-feed” style of debt can cause stress, missed savings goals, or accidental overdrafts.

It Encourages Impulse Spending

BNPL is designed to reduce the “pain” of parting with your money. You don’t feel the cost of your purchase in full — and that disconnect makes it much easier to spend emotionally.

When paying in full, you might have chosen one pair of shoes. With BNPL, you convince yourself to grab two, because “it’s only $30 today.” But multiply that mindset across months, and you may find you’re spending far more than you realise. Spending $600 a month instead of $300 might not feel like a big difference in the moment — but over a year, that’s an extra $3,600. Over three years? You’re looking at $10,800 that could’ve been directed toward your home deposit, investments, or debt reduction.

It Can Still Impact Your Credit File

Not all BNPL services report to credit agencies, but many are starting to. This means that even if you’ve never missed a payment, your use of these services may be recorded on your credit report. When lenders assess your home loan application, they may view multiple active accounts, frequent credit inquiries, or short-term repayment cycles as a red flag.

This isn’t about punishment — it’s about risk. BNPL usage signals a level of dependency on small, short-term debt to fund lifestyle expenses. And in a lending environment that’s getting tighter, those signals matter more than ever.

It Can Undermine Your Financial Story

Your financial behaviour tells a story — and lenders read it closely. If you’re consistently using BNPL for everyday spending, it suggests that you may be living beyond your means or unable to manage expenses without credit. Even if that’s not your intention, or you feel in control, that narrative can impact how much a bank is willing to lend you, or whether they approve your application at all.

This is particularly true for women preparing to buy solo, during or after a major life event (like maternity leave, separation, or career transition). In these scenarios, showing stability and financial maturity is key.

The Rules Can Change — And Often Do

BNPL providers may start out fee-free, but their terms and structures aren’t set in stone. Late fees can climb into the $60+ range per purchase. Some platforms now offer “premium” accounts with monthly charges, and others are introducing interest-bearing versions.

The more you use these platforms, the more they encourage spending and upsell additional features. It’s easy to find yourself paying more than you planned, simply because the product has evolved — and you didn’t notice until it was too late.

It Delays Bigger Dreams Like Property Ownership

This might be the most frustrating part of all. BNPL can quietly push your financial goals further away. If you’re spending $500 a month with these services, that’s $6,000 a year that’s not going into your deposit, emergency savings, or investment account. Over three years, that’s $18,000 — enough for a small home deposit, stamp duty in some areas, or even a renovation fund.

Redirecting just half of that — say, $250 a month — into a strategic savings plan could completely change your financial future. You don’t have to cut out all spending joy. But you do need to be intentional.

The Bottom Line: It’s Not About Being Perfect — It’s About Being Prepared

At Abode Mortgages, we don’t believe in shame or restriction. We believe in clarity, choice, and confidence. Whether you’re a first home buyer, a solo mum, or a woman rebuilding her finances after divorce, you deserve financial advice that sees the full picture.

That’s why we offer She Owns Strategy Sessions — designed to help you understand how your current habits affect your borrowing power, and how to move toward your property goals in a way that actually works for your life.

Ready to Take Control of Your Financial Story?

Let’s ditch the overwhelm and map out a clear, empowering path to property.

Book your free She Owns Strategy Session today.

Your money has power. Let’s help it work for you — not against you.