How does Best Buy financing work?

Discussion in 'Buying Tips and Advice' started by arthursiew, Nov 18, 2008.

  1. macrumors 6502

    arthursiew

    Joined:
    Sep 13, 2008
    Location:
    SF Bay Area
    #1
    I am 15 and my mom agreed that she would take me to Best Buy, so we can get a Samsung T240HD. There's this 18 months no interest deal and I'm willing to do it, but I'm not exactly sure how it works, because you need to apply for some kind of Best Buy credit card. Are there any annual fees or financial charges like the BoA or WaMu cards? I'm also not sure what this means...
    Deferred Interest Info:
    Plan A: Variable Standard APR: 20.99% as of 11/1/08. Variable Default APR: 25.99% as of 11/1/08.
    Plan B: Variable Standard APR: 24.34% as of 11/1/08. Variable Default APR: 29.99% as of 11/1/08.
    Link: http://www.bestbuy.com/site/olspage.jsp?id=pcmcat163300050048&type=category (it's near the bottom).
    Does that mean that I have to pay interest or something? I don't know what that means. It's confusing me, because it said 0% interest. Please tell me what it means.

    Thanks!
     
  2. macrumors 6502a

    Joined:
    Aug 28, 2007
    #2
    do not do either of those plans. If you don't have the cash, stay home. Seriously.

    You are 15, this is a dangerous precedent.

    If you can get the 3 year interest free deal, that is different, but for the love of God, do not pay 21% financing on electronics.
     
  3. thread starter macrumors 6502

    arthursiew

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    #3
    I do have the cash, I just rather do some financing, so I can pay slowly. But I do have interest? It says 18 months 0% interest.
     
  4. macrumors 68040

    synth3tik

    Joined:
    Oct 11, 2006
    Location:
    Minneapolis, MN
    #4
    here is the scope. You happen to have even $1 when the 0 interest is over you will pay ALL interest. Never, never, never sign up for anything like that. It is a big part of the reason we are in the economy we are.

    Honestly those APRs should even send the most naive person running.
     
  5. macrumors 603

    swiftaw

    Joined:
    Jan 31, 2005
    Location:
    Omaha, NE, USA
    #5
    If you notice, it says Deferred Interest.

    What that means is, you have 18 months to pay off the balance without paying any interest. If you do not pay off the balance in 18 months you then have to pay all the interest that has been accumulating over time and has been deferred until that point.

    So the answer to the question "Is there interest?" is yes and no. Yes, there is interest, but it is deferred for a period of 18 months. Pay your entire balance before that and you don't pay any interest.
     
  6. macrumors 603

    swiftaw

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    #6
    Unless of course you are 100% sure you can pay it off in the time limit. I have done this several times and always paid everything off a couple of months ahead of time. If you are sensible it is very useful, if you are not it is a disaster.
     
  7. thread starter macrumors 6502

    arthursiew

    Joined:
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    Location:
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    #7
    Yes, I will be able to pay in time. I already planned on paying $30 a month and 40 for some months to be a little safer.
    So do I just go to the BB store and sign up for the credit card for my mom? How does the sign up process work?
    Anyways, thanks for the quick answers. The first part of my question has been answered.
     
  8. macrumors 68040

    synth3tik

    Joined:
    Oct 11, 2006
    Location:
    Minneapolis, MN
    #8

    At that point why ot just pay in cash and not have to worry at all about it. No one can say they "knows they can pay it off in time. Unless they pay it all right away, then again, why not cash.

    I don't think people look a credit seriously enough. "Don't have the money?, that's ok. We'll let you make payments".

    The OP stated they had the money. If they did ot I would say don't even look at buying it. Since the OP has money I will say pay for it with the money they have. It makes life so much simpler.
     
  9. thread starter macrumors 6502

    arthursiew

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    #9
    Right now, I'm still deciding and I want to know how will sign up process go. Do I just sign it up for my mom and then get the card or something? How does the process go?
    If it ends up getting complicated, I'll just pay in full.
     
  10. macrumors 6502a

    Joined:
    Aug 28, 2007
    #10
    I see you said you could get the no interest deal....

    Anyway, you are only 15, you would not be able to get credit, and even if you had your mom get the line of credit, it would not help you build up your credit score because you are only 15.

    Pay for it in cash.
     
  11. macrumors 6502a

    Joined:
    Aug 28, 2007
    #11
    it works just like any other line of credit, you apply, they check you out, and approve you for a certain amount. You are under 18 though, so you are not going to be able to access the financing. It would be 100% your mom.
     
  12. thread starter macrumors 6502

    arthursiew

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    #12
    Let's just say this. I am going to sign it up for my mom, pay my mom and have my mom pay with the money I gave her.
    Please answer my question above. Thanks guys! :D
     
  13. macrumors 603

    swiftaw

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    #13
    One time I did it because I needed something right away but I didn't have the money at that point, but I knew I was getting a lump some a few months down the line. So I bought it and paid it off once I got my lump sum payment.

    The other times, the cards offered rewards, so I used the card, got the reward then paid off the card.
     
  14. macrumors 6502a

    Joined:
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    #14
    you could do that. But really, there would be no benefit. It's what $500? you are not going to earn enough interest on that to make it worth while to not just pay up front.
     
  15. thread starter macrumors 6502

    arthursiew

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    #15
    So my mom said that she would sign up for herself. Can I pay my mom and have my mom pay BB back with the money I gave her?
     
  16. macrumors 6502

    Joined:
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    Location:
    Ogden, UT
    #16
    i would stear clear... I feel into a similar situation my freshman year... I paid off the balance before the time frame.. but somewhere in one of the papers that I signed I agreed to some credit protection policy that I was charged X amount per month for...and then that balance was due after I payed of the laptop... (another 400 bucks)... I tried to fight it but they marked up my credit score and I ended up paying because I did sign the paper...


    to make matters worse it was a POS laptop that had to be repaired 10 times in 2 years...

    so long story short... pay for it now if you have the money... or use at least use a reputable credit card which is going to be nearly impossible at 15...

    finally if you do you BB credit ...READ EVERY LINE OF EVERY PAPER YOU SIGN!
     
  17. thread starter macrumors 6502

    arthursiew

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    #17
    Well, I would have paid in full, but my mom wants me to get used to the world as an adult. She wants me to be sure that I can pay back loans in time and everything. I feel that it would be something that I should learn. She also told me that if I end up not having enough cash during the 18 months, she would cover it, so we won't end up paying the interest.
     
  18. macrumors 603

    swiftaw

    Joined:
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    Location:
    Omaha, NE, USA
    #18
    I don't know, can you?

    The card has to be in your mom's name, so she is responsible for paying the bill. If she is okay with that arrangement then there's no reason why it can't work.
     
  19. macrumors 6502a

    Joined:
    Aug 28, 2007
    #19
    you COULD do this, but why? are you concerned about not having any cash on hand if you pay in full?

    Please explain your interest in the financing deal, are you just curious in how it all works?
     
  20. macrumors 6502a

    Joined:
    Aug 28, 2007
    #20
    there are plenty of adults that pay in cash. the 'adult' world of excess financing is what has caused our current financial crisis.
     
  21. thread starter macrumors 6502

    arthursiew

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    #21
    Like I said, my mom wants me to get into the world as an adult. She wants to make sure that I would be able to cover things on my own like loans and everything. My dad also did this thing before, but he's out of the country until Summer...
     
  22. thread starter macrumors 6502

    arthursiew

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    #22
    Yes, she's okay with that arrangement. My brother, 17, is also up for this, so it kind of makes things easier with the payment now. He said that he would contribute, cause he wanted it too.
     
  23. macrumors Nehalem

    GoCubsGo

    Joined:
    Feb 19, 2005
    #23
    25% APR? Holy fck that is a loan shark's loan!
     
  24. thread starter macrumors 6502

    arthursiew

    Joined:
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    Location:
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    #24
    One more thing... can I sign up at the store? We finally made a decision to go with the offer. Thanks!
     
  25. macrumors 603

    swiftaw

    Joined:
    Jan 31, 2005
    Location:
    Omaha, NE, USA
    #25
    Yes, She will go to the store, fill out the application form, wait for the credit check, get approved, then buy want she wants to buy.
     

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