Finance or pay cash for new road bike?
Pay cash for it.
The 0% financing deal can do a number on your FICO score.
Because they will allow you a credit card deal for $1500 which will show up on your credit report as an immediately maxed out account.
Limit $1500 used credit $1500 = available credit Zero.
Any maxed out account on your credit report will ding your score...
The 0% financing deal can do a number on your FICO score.
Because they will allow you a credit card deal for $1500 which will show up on your credit report as an immediately maxed out account.
Limit $1500 used credit $1500 = available credit Zero.
Any maxed out account on your credit report will ding your score...
LisaA
Member
- Mar 14, 2008
- 59
- 0
- 6
The rule is to never ever finance a depreciating asset.
But if you get 0% financing, and you can afford it (if you have the money in the bank already) and if there are no catches, like a higher sales price to get the 0%, then take the 0%. You will come out ahead because you have the money in the bank making interest for you (however little that might be.)
Just make sure you read the fine print, and follow all of the rules and jump through all of the hoops in order to make sure you actully get 0% and you aren't stuck with fees, penalties, or a default interest rate.
But if you get 0% financing, and you can afford it (if you have the money in the bank already) and if there are no catches, like a higher sales price to get the 0%, then take the 0%. You will come out ahead because you have the money in the bank making interest for you (however little that might be.)
Just make sure you read the fine print, and follow all of the rules and jump through all of the hoops in order to make sure you actully get 0% and you aren't stuck with fees, penalties, or a default interest rate.