Check it out. Say you are in the market for a really nice flat screen TV (I’m not). You have been saving for the TV for quite some time and have narrowed it down to the exact model you want. You know it’s gonna cost you $3,000 and you think you got everything all figured out. Then, out of nowhere, a curveball comes your way. The Best Buy employee asks if you’d be interested in their “0% financing for 12 months” option. What do you do? What do you!
I never thought I would sign up to finance anything, ever, but something about that nice and round “zero” is tempting. Maybe it’s like a donut though. Looks good, tastes good, but once you eat it you immediately regret your decision.
I have read some whore horror stories about people who signed up for 3 months of 0% financing, only to find out when they tried to pay their balance in full (at the conclusions of their 90 days), they were slapped with some ridiculous early payment fees…apparently the contract they signed stated you couldn’t pay your balance off for 12 months without being penalized.
I know there are some 0% finance scams, with incredibly shady terms. But (Yes, I just broke a rule and started a sentence with “but”) there also appears to be some that are rather legitimate, namely those from larger companies.
So the question is bloggers, do I play with the devil, knowing I could minimize the impact of a four figure purchase by splitting up the cost over a 3, 6, or 12 month period. If you were gonna drop $3K on the TV would you take the free financing or exercise sound financial knowledge and pay for the sucker up front? Anyone have any experience with the 0% financing game?