Layaway - the pay-as-you-go way of making purchases that was common years ago - is back.

Popular with past generations, layaway was rendered almost obsolete by the rise of credit cards and instant credit accounts in department stores.

But this year, amid a sour economy and consumers struggling with heavy debt loads, stores say demand for the service has grown. And at least one big retailer - Kmart - is touting layaway prominently in its advertising.

"People still need to buy things, but many just don't have the money right now," said Becky Diamond, store manager of a Burlington Coat Factory in Orem. "And they don't want to use a credit card and pay the interest."

Layaway, for the uninitiated, allows shoppers to select what they want to buy, make a "down payment" of some amount and have their merchandise stored at no interest while they make payments over a period of time, typically four to eight weeks. After they make the final payment, the merchandise is theirs.

Burlington Coat Factory, which has locations in Murray and Orem, has been offering layaway since 1972, Diamond said. Anything in the store, even sale and clearance items, can be put on layaway. Depending on the type of merchandise selected (Burlington carries apparel, children's items, furniture and other merchandise), shoppers have 30 to 90 days to make payments.

Like many such programs, Burlington charges a $5 service fee each time items are put on layaway. Those who cancel - or have their accounts canceled because of nonpayment - must pay an additional $5 fee.

The program is similar to one offered by women's apparel retailer Fashion Bug, which has a $5 layaway fee. Shoppers must make a 10 percent down payment and pay in full within 30 days.

Kmart has a layaway program that runs as long as eight weeks. As with other retailers, customers are charged $5 for each layaway and a $10 cancellation fee.

Although Kmart has offered the service for years, its TV ads are reintroducing the concept not only to shoppers who might not have used it recently but educating legions of others - especially those in their 20s and 30s - who don't know about the concept.

''In the backdrop of this economy, it all of a sudden has a great deal of relevance,'' said Tom Aiello, a spokesman for the subsidiary of Sears Holdings Corp.

Layaway can be a valuable tool to avoid credit cards, and for many that's a big part of its draw.

Willie Brown, of Orem, said he got out of the cycle of carrying balances on his credit cards, thanks in great part to layaway. "I really don't like using credit cards at all now. I don't like paying the interest."

He says he likes to shop at Burlington Coat Factory with layaway because he doesn't have to worry that what he wants to buy will still be available and in his size by the time he has the money saved to buy it.

Though such programs are enjoying a revival, layaway-oriented sales still make up only a tiny fraction of retail sales nationally. said Kathy Grannis, spokeswoman for the National Retail Federation. In fact, most big chain stores don't offer the service. Wal-Mart discontinued its layaway program in 2006, citing the costs of administering it - paying employees to store, document and release layaway items. Company officials decline to say whether they are reconsidering.

Grannis said those who do offer layaway will benefit this holiday shopping season because consumers are more "budget focused," though she doubts many retailers will bring back a program they discontinued years ago.

"Retailers are very smart when it comes to who their consumers are and how they shop. It wouldn't make sense for a large retailer to invest time and money into a program they've already done away with just to get rid of it again when the economy turns around."

Still, retailers that have added programs say layaway - especially now - can draw customers who otherwise wouldn't buy.

K.C. Sanders, of Sanders Art Studio in Ogden, which sells Disney artwork onsite and online, said she began offering layaway in May 2007.

Since then, about 30 people, including 10 Utahns, have used layaway to make purchases ranging in price from $300 to $1,500. Sanders said she asks buyers to make monthly payments and finalize purchases within six months, although some have taken a year to pay off their purchases.

No one has canceled a layaway contact, she said. Part of that may be because the store isn't inclined to provide a cash refund on canceled layaways.

Sanders said she's sure the program enables her to sell artwork she wouldn't be able to otherwise. "People are still using credit cards, but I just think they just don't want to use them as much."

lesley@sltrib.com

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* THE ASSOCIATED PRESS contributed to this story.

Should you use layaway?

Experts say layaway programs can help consumers avoid piling on credit debt, but remember:

* You will pay a fee each time you put items on layaway, although most fees are nominal, about $5. The fee might be a good alternative to paying interest on a purchase charged to a credit card.

* Most layaway programs run one to two months. But if you decide you don't want the merchandise before you have completed payments or if you can't pay in full in the specified time, you will typically pay a cancellation fee of $5 to $10.

* Retailers may discount prices later in the season to stimulate lagging sales. If you opened a layaway account early, you might be locked into higher prices. But this could work in your favor if you put items on layaway that are on sale or clearance because you are locked in at a good price and there's no chance of your items being out of stock.

* It pays to read the fine print. The layaway policy at women's apparel retailer Fashion Bug states that "price adjustments will be made for regular-price items that go on sale while in layaway." But to get the price adjustment, you must pay in full for the layaway item while the sale is still in effect.