What's the deal with "Interest free" credit (UK - PC World)

[glossywhite]

Hi all. I am about to start a venture for which I need to buy a MBP, but we are looking to purchase it on "Interest free" credit. I know that sometimes they make it as difficult as poss to repay within the 0% period, but believe me I'll make sure I pay it within that period.

I spoke to a salesman earlier, who tried to tell me that if I bought the MBP on "Interest free" plan, I'd pay 10% more... this just doesn't add up to me (pardon the contradictory pun! ). If the cash price is £1,328 and I take it on interest free, and pay the loan back WITHIN the period, I pay £1,328 and not a penny more, right?. They are hoping I will fall behind and default to the X% APR rate so that they can rinse me dry, surely?.

My question is, I am not gonna pay a penny more than the stated RRP unless I default and fail to pay the full amount within the agreed timescale - am I correct?. Would someone with more financial knowledge mind explaining this, as simply as concisely as possible, as this salesman sounded like he was talking out of his, erm, "hat".

Thanks.

PS: No, going down the Apple UK route is not an option, in case anyone suggests it!

 

[ttopp]

if they say interest free then there should be no extra costs (except 4 defaulting)..


I would ask what the 10% he was talking about was? payment protection, insurance??

i got it from an apple approved seller for 6 months interest free a few years ago and only paid the retail price when i paid the last payment for the remainder of the balance..

 

[cRuNcHiE]

read the small print. I remember when i was offered something with dixons 'interest free' there was a 10% stealth tax somewhere.I think it was something like i had to give 30 days notice before the end of the interest free period if i was going to pay it off, otherwise they added on 10%.

Dixons/pcworld are in the same company group i believe.

 

[glossywhite]

My personal morality tells me that paying people like this any kind of "interest" is immoral, and far from being in anyone's interest. They would have to come to my door and beat it out of me, literally. I'll pay back the sum I borrow, not one penny more OR less.

Interest is a device of the greedy, I'll research this more, but the reason I ask is that I don't need their BS tactics giving me stress, it's not a matter of them holding a gun to my head - noone will be doing that, I pay back the precise value of the goods. Period.

Thanks for the help

PS: Yes, they are all part of DSGI. It is simply a matter of convenience of transport and the person arranging the finance for me being VERY busy and having no spare time to travel, which prevents me going to anywhere but them, unfortunately.

 

[ucfgrad93]

A word of caution about interest free periods. Read the fine print carefully. In many cases if you don't pay off the item during that period, they add interest on the full amount of the purchase, retroactive to the date of purchase.

 

[glossywhite]

A word of caution about interest free periods. Read the fine print carefully. In many cases if you don't pay off the item during that period, they add interest on the full amount of the purchase, retroactive to the date of purchase.

The reason we are seeking credit is that there is no immediate liquid assets with which to pay. The project backer is fantastic with financial deals, and has regular dealings with many hundreds of thousands of pounds, without batting an eyelid. It *will* be paid, I just don't want them taking my backer (also a friend) for a ride, it just is not gonna happen, which is why I am asking for specifics from those with personal experience, if possible.

As mentioned before, I am just taking precautions so as not to cause hard feeling to a friend who has an interest in my project. The payment of "interest" to lending party just will not happen. Ever, regardless of what, as idle threats from corrupt billionaires do not phase me. I'm just simply trying to minimise stress so that I can focus on the technical aspects, not the crazy monetary side of things.

Thanks again dudes.

 

[sinar]

Hi,

Last year I bought a 24" imac from PC world using their 12 interest free deal, I paid up in full within the 12 months interest free period, I had to pay the cost price plus an arrangement fee, I think that was about £24. There were no other charges.

You could also consider Argos, if they have the MBP you want, and pay on their card to get six months interest free credit,

Julie

 

[ramases]

Have you considered an Apple reseller, some of them offer up to 9 months interest free credit. Alternatively look at moneysavingexpert.com and check for interest free credit cards. I think Virgin have 12 months interest free for purchases. Alternatively, a business lease from Apple may be a better bet, yes it may cost slightly more, but there can be advantageous tax benefits etc. I've used interest free options in the past and not had to pay anything other than the monthly fee's, although some finance agreements are now written slightly differently, requiring you to pay a fee as an 'option to purchase'.

 

[bbeesley]

The payment of "interest" to lending party just will not happen. Ever, regardless of what, as idle threats from corrupt billionaires do not phase me. I'm just simply trying to minimise stress so that I can focus on the technical aspects, not the crazy monetary side of things.

Thanks again dudes.

Don't you think its rather unreasonable to call someone lending you money a "corrupt billionaire". Selling a product on credit is obviously a valuable service, you are borrowing someones money. Typically you expect to pay money for a valuable service. If you want a bank loan for a startup business you pay interest, if you want a mortgage for a house you pay interest. All this chat about paying interest being immoral sounds like a lot of nonsense from someone who has little grasp of the way business (and finance in general) works.

Good luck though, you'll enjoy your MBP, probably worth mentioning that the buyer's guide on this site suggests not to buy one currently as updates are due imminently.