Financing of major purchases at zero percent interest can save a bundle. At this time of year, there are so many offers to transfer balances, which can be a blessing. But you have to understand the game and know what you’re doing.
In November I received such an offer in one of my credit card statements. “When you transfer a credit card balance to OUR card, we’ll give you 12 months financing (with a small cash advance fee) at 0%. After that, we’ll gouge you, but it’s still a sweet deal.” I kept it. You never know.
An expensive Christmas gift was purchased in our household this year, components bought online, built by dad and son together. It was more expensive than I would have liked, but still a good deal, and a nice gift. That was supposed to be sweeter with a zero percent interest for 10 months deal, if DH got their credit card. We drank the KoolAid and signed up. But the online company broke out all the components into separate purchases, so that only two of the parts qualified for the special financing. Really? I thought I would pay it off in two or three interest-free payments, but that wasn’t going to happen now, especially with the unexpected medical bill situation. And making minimum payments at 20% APR also wasn’t going to happen.
Wait, I had that 0% balance transfer deal! After reading everything 10 times, and knowing for certain what I was getting into, I waited for the first bill for the new online company account, and used the balance transfer check to pay it off in full. HA! Take that, you snakes! Everything posted as of this morning, and now we’re hitting your account out of the park.
Let me state emphatically that this does not adversely affect our credit rating (I checked this morning). We’re way above 800, and pay off our consumer cards in full each month (purchases are budgeted to begin with). So we’re not concerned with the credit rating, especially since we’ll be closing out the account. The consumer credit card now hosting the transfer balance, had a zero balance. I will not be using it for anything else over the duration of this process. I might even get rewards points for the balance transfer, but that wasn’t very clear, and would be a surprise bonus.
The balance transfer fee was minimal. We’ll be dividing the starting balance by 10 and paying much more than the minimum. Normally this would seem to be a shell game to me, and I would avoid this kind of thing. But given the shady practices surrounding the online company here, I’m happy to relieve them of their debt service! And any further encumbrances of our doing business with them.
For us, this means that while I paid off early the zero interest account for the emergency washing machine purchase this month, next month we have the same amount I was paying due to this new debt. Lovely. Life goes on, though, and knowing how to play the game puts us closer to enjoying each inning. Still looking for that financial home run.