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What does "same as cash financing for 12 months" mean?
- Thread starter aar2697
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Here's a good explanation http://thefinancebuff.com/2009/01/0-percent-apr-same-as-cash-and-no-interest-no-payments.html
Make sure you understand the "timebomb" aspect if you sign up for a deal like that.
Greg
Make sure you understand the "timebomb" aspect if you sign up for a deal like that.
The "same as cash" deal is usually offered by a retail store. You have to sign up for their store credit card. You also make minimum payments during the promotion period, same as in the "0% APR" deal. If you don't pay off the balance in full by the end of the promotion period, you pay retroactive interest from the very beginning, at a rate often 20% or higher. It's called a deferred interest financing program. If you pay one dollar less or one day late, you still activate the retroactive interests. Basically you have this time bomb ticking. If you defuse it before the clock strikes twelve, you escape unscathed. If you miss it, it explodes in your face.
Greg
No it means for 11 months you pay what it would be if you were paying over a 3 year ( with interest) deal but at the end of the year on the 12th payment you can pay the rainder of wat you owe with no intrest added so if the purchase was 1000 a year ago you still only pay up to that. Or you can continue to pay the monthly rate but incoure intrest on that over the rest of the loan repayments.
Yeah, the "same as cash" part means "no financing charges" (because you don't pay anything extra when you pay by cash).
However, be very careful when entering a finance deal such as this, as there are still ways that this can blow up in your face. When I bought my 12" PowerBook some years ago, the terms were "180 days interest free on the first charge to the account". Did you know that when you order a BTO Mac with some software on the side, Apple ships the software well before the Mac ships? Guess what was the first charge to my account? Yep, I had 180 days to pay off $150 without any interest, but 28.8% interest started accumulating instantly on $3000 worth of Mac.
Did I mention that I couldn't truly afford the new Mac at the time, and that I was really counting on six months of no-interest payments to make it work? That mistake cost me dearly.
However, be very careful when entering a finance deal such as this, as there are still ways that this can blow up in your face. When I bought my 12" PowerBook some years ago, the terms were "180 days interest free on the first charge to the account". Did you know that when you order a BTO Mac with some software on the side, Apple ships the software well before the Mac ships? Guess what was the first charge to my account? Yep, I had 180 days to pay off $150 without any interest, but 28.8% interest started accumulating instantly on $3000 worth of Mac.
Did I mention that I couldn't truly afford the new Mac at the time, and that I was really counting on six months of no-interest payments to make it work? That mistake cost me dearly.
I did this all of my life, and then I couldn't buy a house when the time came because of "insufficient credit history". Not one bad mark on my record...but you need three sources of payment history.
So, buy what you can afford..most of the time. xD
I require a Mac for what I do. My iMac's hard drive screwed up and so did some other things and it's useless for me.
I did this all of my life, and then I couldn't buy a house when the time came because of "insufficient credit history". Not one bad mark on my record...but you need three sources of payment history.
So, buy what you can afford..most of the time. xD
I never said to not use credit cards. You just have to know how to use them.
I use my credit card (I have 2 cards in the US, but only use 1) for 98% of my purchases. That way, I can take advantage of their points systems to get free trips, cash, stuff, etc. The thing is, when the bill is due, I pay the entire amount owing. Never the minimum or partial payment. That is how you keep a high credit score. I simply keep track of what I spend so that I only spend what I can afford.
I probably hit the ATM twice a month, and that's only because our favorite sushi restaurant only accepts cash.
If you had sufficient credit history, but it involved always paying the minimum payment, missing payments, etc., then you wouldn't have qualified for the house anyway.
You have to know how to play the game when it comes to credit.
I wasn't judging you, I was offering advice. I hope that you figure out a way to make it work.
If it's for a business, shouldn't you expense it (the business should pay for it)?
Some people pay off the bill "too soon". They'll go shopping and charge $100 to the credit card, then when they get home they make a $100 bill payment that night. This is great for disciplining yourself to pay only what you can afford, but this will not help you build a credit score because the net balance each month ends up to be zero, so it's just as useless to your credit score as if you never used the card at all.
To build up a good credit score, use the card as normal, then when the bill comes in, pay the bill amount off in full, as you said earlier.
