Should I use a zero-interest credit card for a large one-time purchase?
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An upcoming purchase (nearing $10,000 US) would drain savings more than I'd be comfortable with, and I'm wondering if using a zero-interest card to effectively spread out that purchase for 15-20 months would be sensible.
This is for a non-emergency but necessary medical expense.
There does not to appear to be any chance of not paying that balance off before the interest-free period kicks in. We have good general bill-paying discipline and I'd probably just automate the payments and get it to zero with some time to spare.
What I'm unsure of is: could I run afoul of unexpected "fees" or other costs? Would this affect my credit rating? I have no other recurring debt; all other credit cards are always paid off in full.
This seems to be quite different from a zero-interest balance transfer scenario.
Thanks
credit-card
asked 4 hours ago
DaveInCazDaveInCaz
1253
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add a comment |
An upcoming purchase (nearing $10,000 US) would drain savings more than I'd be comfortable with, and I'm wondering if using a zero-interest card to effectively spread out that purchase for 15-20 months would be sensible.
This is for a non-emergency but necessary medical expense.
There does not to appear to be any chance of not paying that balance off before the interest-free period kicks in. We have good general bill-paying discipline and I'd probably just automate the payments and get it to zero with some time to spare.
What I'm unsure of is: could I run afoul of unexpected "fees" or other costs? Would this affect my credit rating? I have no other recurring debt; all other credit cards are always paid off in full.
This seems to be quite different from a zero-interest balance transfer scenario.
Thanks
credit-card
asked 4 hours ago
DaveInCazDaveInCaz
1253
New contributor
DaveInCaz is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
Care to give a hint as to what the purchase is? Answers will be very different for "A new roof on our house" vs "That trip we've wanted."
– JoeTaxpayer♦
3 hours ago
@JoeTaxpayer thanks, edited
– DaveInCaz
2 hours ago
add a comment |
An upcoming purchase (nearing $10,000 US) would drain savings more than I'd be comfortable with, and I'm wondering if using a zero-interest card to effectively spread out that purchase for 15-20 months would be sensible.
This is for a non-emergency but necessary medical expense.
There does not to appear to be any chance of not paying that balance off before the interest-free period kicks in. We have good general bill-paying discipline and I'd probably just automate the payments and get it to zero with some time to spare.
What I'm unsure of is: could I run afoul of unexpected "fees" or other costs? Would this affect my credit rating? I have no other recurring debt; all other credit cards are always paid off in full.
This seems to be quite different from a zero-interest balance transfer scenario.
Thanks
credit-card
asked 4 hours ago
DaveInCazDaveInCaz
1253
New contributor
DaveInCaz is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
An upcoming purchase (nearing $10,000 US) would drain savings more than I'd be comfortable with, and I'm wondering if using a zero-interest card to effectively spread out that purchase for 15-20 months would be sensible.
This is for a non-emergency but necessary medical expense.
There does not to appear to be any chance of not paying that balance off before the interest-free period kicks in. We have good general bill-paying discipline and I'd probably just automate the payments and get it to zero with some time to spare.
What I'm unsure of is: could I run afoul of unexpected "fees" or other costs? Would this affect my credit rating? I have no other recurring debt; all other credit cards are always paid off in full.
This seems to be quite different from a zero-interest balance transfer scenario.
Thanks
credit-card
credit-card
asked 4 hours ago
DaveInCazDaveInCaz
1253
New contributor
DaveInCaz is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
asked 4 hours ago
DaveInCazDaveInCaz
1253
New contributor
DaveInCaz is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
edited 2 hours ago
DaveInCaz
asked 4 hours ago
DaveInCazDaveInCaz
1253
New contributor
DaveInCaz is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
asked 4 hours ago
DaveInCazDaveInCaz
1253
asked 4 hours ago
DaveInCazDaveInCaz
1253
1253
New contributor
DaveInCaz is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
New contributor
DaveInCaz is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
DaveInCaz is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
Care to give a hint as to what the purchase is? Answers will be very different for "A new roof on our house" vs "That trip we've wanted."
– JoeTaxpayer♦
3 hours ago
@JoeTaxpayer thanks, edited
– DaveInCaz
2 hours ago
add a comment |
Care to give a hint as to what the purchase is? Answers will be very different for "A new roof on our house" vs "That trip we've wanted."
– JoeTaxpayer♦
3 hours ago
@JoeTaxpayer thanks, edited
– DaveInCaz
2 hours ago
Care to give a hint as to what the purchase is? Answers will be very different for "A new roof on our house" vs "That trip we've wanted."
– JoeTaxpayer♦
3 hours ago
Care to give a hint as to what the purchase is? Answers will be very different for "A new roof on our house" vs "That trip we've wanted."
– JoeTaxpayer♦
3 hours ago
@JoeTaxpayer thanks, edited
– DaveInCaz
2 hours ago
@JoeTaxpayer thanks, edited
– DaveInCaz
2 hours ago
add a comment |
1 Answer
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Looking at the intended expense, it's (in my opinion) as if you asked "For a non-discretionary expense, do we tap our savings or take advantage of a zero-rate offer?"
The only advice, aside from discussing the card itself, is to suggest you ask the doctor/hospital if they offer either a discount for quick payment in full, or a payment plan at no interest. There's also a chance they can reduce the bill itself, if you have no insurance.
You seem to have addressed the card itself. The warnings are usually about the mistake along the way. One missed/late payment, and you'll owe interest, typically 24%, until it's paid off. By setting up an auto-pay and being 100% sure it's working, you'll be fine.
As far as credit report goes, it will appear as a debt, and your utilization will drop as you pay it down. Once paid, the impact fades quickly, as this is one of the scoring factors that's near real-time, in comparison to credit inquiries (2 years) or missed payments (7 years on report).
answered 2 hours ago
JoeTaxpayer♦JoeTaxpayer
147k23237477
We have a really screwed up medical system with multiple tiers of billing for the same services (US). I have a common generic prescription that had cost me a $1 copay. Recently, it was dropped from the formulary and the new price became $71, but if I bypassed my insurance, the cash price was $36. I second Joe's suggestion. Ask the doctor/hospital if they can reduce the bill for cash payment, regardless of whether you have insurance or not. The worst that they can say is no.
– Bob Baerker
1 hour ago
Bob, when my wife had her appendix out, the bill was $24K, but hospital accepted $4K from insurance and our share was $800. I suspect a cash payer can negotiate a cash price between the $4K and the $24K. Our insurance system is broken. (Or one can believe that with no insurance, we’d be held to the $24K, making the insurance worth the $20K/yr we pay)
– JoeTaxpayer♦
1 hour ago
add a comment |
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1 Answer
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Looking at the intended expense, it's (in my opinion) as if you asked "For a non-discretionary expense, do we tap our savings or take advantage of a zero-rate offer?"
The only advice, aside from discussing the card itself, is to suggest you ask the doctor/hospital if they offer either a discount for quick payment in full, or a payment plan at no interest. There's also a chance they can reduce the bill itself, if you have no insurance.
You seem to have addressed the card itself. The warnings are usually about the mistake along the way. One missed/late payment, and you'll owe interest, typically 24%, until it's paid off. By setting up an auto-pay and being 100% sure it's working, you'll be fine.
As far as credit report goes, it will appear as a debt, and your utilization will drop as you pay it down. Once paid, the impact fades quickly, as this is one of the scoring factors that's near real-time, in comparison to credit inquiries (2 years) or missed payments (7 years on report).
answered 2 hours ago
JoeTaxpayer♦JoeTaxpayer
147k23237477
We have a really screwed up medical system with multiple tiers of billing for the same services (US). I have a common generic prescription that had cost me a $1 copay. Recently, it was dropped from the formulary and the new price became $71, but if I bypassed my insurance, the cash price was $36. I second Joe's suggestion. Ask the doctor/hospital if they can reduce the bill for cash payment, regardless of whether you have insurance or not. The worst that they can say is no.
– Bob Baerker
1 hour ago
Bob, when my wife had her appendix out, the bill was $24K, but hospital accepted $4K from insurance and our share was $800. I suspect a cash payer can negotiate a cash price between the $4K and the $24K. Our insurance system is broken. (Or one can believe that with no insurance, we’d be held to the $24K, making the insurance worth the $20K/yr we pay)
– JoeTaxpayer♦
1 hour ago
add a comment |
Looking at the intended expense, it's (in my opinion) as if you asked "For a non-discretionary expense, do we tap our savings or take advantage of a zero-rate offer?"
The only advice, aside from discussing the card itself, is to suggest you ask the doctor/hospital if they offer either a discount for quick payment in full, or a payment plan at no interest. There's also a chance they can reduce the bill itself, if you have no insurance.
You seem to have addressed the card itself. The warnings are usually about the mistake along the way. One missed/late payment, and you'll owe interest, typically 24%, until it's paid off. By setting up an auto-pay and being 100% sure it's working, you'll be fine.
As far as credit report goes, it will appear as a debt, and your utilization will drop as you pay it down. Once paid, the impact fades quickly, as this is one of the scoring factors that's near real-time, in comparison to credit inquiries (2 years) or missed payments (7 years on report).
answered 2 hours ago
JoeTaxpayer♦JoeTaxpayer
147k23237477
We have a really screwed up medical system with multiple tiers of billing for the same services (US). I have a common generic prescription that had cost me a $1 copay. Recently, it was dropped from the formulary and the new price became $71, but if I bypassed my insurance, the cash price was $36. I second Joe's suggestion. Ask the doctor/hospital if they can reduce the bill for cash payment, regardless of whether you have insurance or not. The worst that they can say is no.
– Bob Baerker
1 hour ago
Bob, when my wife had her appendix out, the bill was $24K, but hospital accepted $4K from insurance and our share was $800. I suspect a cash payer can negotiate a cash price between the $4K and the $24K. Our insurance system is broken. (Or one can believe that with no insurance, we’d be held to the $24K, making the insurance worth the $20K/yr we pay)
– JoeTaxpayer♦
1 hour ago
add a comment |
Looking at the intended expense, it's (in my opinion) as if you asked "For a non-discretionary expense, do we tap our savings or take advantage of a zero-rate offer?"
The only advice, aside from discussing the card itself, is to suggest you ask the doctor/hospital if they offer either a discount for quick payment in full, or a payment plan at no interest. There's also a chance they can reduce the bill itself, if you have no insurance.
You seem to have addressed the card itself. The warnings are usually about the mistake along the way. One missed/late payment, and you'll owe interest, typically 24%, until it's paid off. By setting up an auto-pay and being 100% sure it's working, you'll be fine.
As far as credit report goes, it will appear as a debt, and your utilization will drop as you pay it down. Once paid, the impact fades quickly, as this is one of the scoring factors that's near real-time, in comparison to credit inquiries (2 years) or missed payments (7 years on report).
answered 2 hours ago
JoeTaxpayer♦JoeTaxpayer
147k23237477
Looking at the intended expense, it's (in my opinion) as if you asked "For a non-discretionary expense, do we tap our savings or take advantage of a zero-rate offer?"
The only advice, aside from discussing the card itself, is to suggest you ask the doctor/hospital if they offer either a discount for quick payment in full, or a payment plan at no interest. There's also a chance they can reduce the bill itself, if you have no insurance.
You seem to have addressed the card itself. The warnings are usually about the mistake along the way. One missed/late payment, and you'll owe interest, typically 24%, until it's paid off. By setting up an auto-pay and being 100% sure it's working, you'll be fine.
As far as credit report goes, it will appear as a debt, and your utilization will drop as you pay it down. Once paid, the impact fades quickly, as this is one of the scoring factors that's near real-time, in comparison to credit inquiries (2 years) or missed payments (7 years on report).
answered 2 hours ago
JoeTaxpayer♦JoeTaxpayer
147k23237477
answered 2 hours ago
JoeTaxpayer♦JoeTaxpayer
147k23237477
answered 2 hours ago
JoeTaxpayer♦JoeTaxpayer
147k23237477
answered 2 hours ago
JoeTaxpayer♦JoeTaxpayer
147k23237477
147k23237477
We have a really screwed up medical system with multiple tiers of billing for the same services (US). I have a common generic prescription that had cost me a $1 copay. Recently, it was dropped from the formulary and the new price became $71, but if I bypassed my insurance, the cash price was $36. I second Joe's suggestion. Ask the doctor/hospital if they can reduce the bill for cash payment, regardless of whether you have insurance or not. The worst that they can say is no.
– Bob Baerker
1 hour ago
Bob, when my wife had her appendix out, the bill was $24K, but hospital accepted $4K from insurance and our share was $800. I suspect a cash payer can negotiate a cash price between the $4K and the $24K. Our insurance system is broken. (Or one can believe that with no insurance, we’d be held to the $24K, making the insurance worth the $20K/yr we pay)
– JoeTaxpayer♦
1 hour ago
add a comment |
We have a really screwed up medical system with multiple tiers of billing for the same services (US). I have a common generic prescription that had cost me a $1 copay. Recently, it was dropped from the formulary and the new price became $71, but if I bypassed my insurance, the cash price was $36. I second Joe's suggestion. Ask the doctor/hospital if they can reduce the bill for cash payment, regardless of whether you have insurance or not. The worst that they can say is no.
– Bob Baerker
1 hour ago
Bob, when my wife had her appendix out, the bill was $24K, but hospital accepted $4K from insurance and our share was $800. I suspect a cash payer can negotiate a cash price between the $4K and the $24K. Our insurance system is broken. (Or one can believe that with no insurance, we’d be held to the $24K, making the insurance worth the $20K/yr we pay)
– JoeTaxpayer♦
1 hour ago
We have a really screwed up medical system with multiple tiers of billing for the same services (US). I have a common generic prescription that had cost me a $1 copay. Recently, it was dropped from the formulary and the new price became $71, but if I bypassed my insurance, the cash price was $36. I second Joe's suggestion. Ask the doctor/hospital if they can reduce the bill for cash payment, regardless of whether you have insurance or not. The worst that they can say is no.
– Bob Baerker
1 hour ago
We have a really screwed up medical system with multiple tiers of billing for the same services (US). I have a common generic prescription that had cost me a $1 copay. Recently, it was dropped from the formulary and the new price became $71, but if I bypassed my insurance, the cash price was $36. I second Joe's suggestion. Ask the doctor/hospital if they can reduce the bill for cash payment, regardless of whether you have insurance or not. The worst that they can say is no.
– Bob Baerker
1 hour ago
Bob, when my wife had her appendix out, the bill was $24K, but hospital accepted $4K from insurance and our share was $800. I suspect a cash payer can negotiate a cash price between the $4K and the $24K. Our insurance system is broken. (Or one can believe that with no insurance, we’d be held to the $24K, making the insurance worth the $20K/yr we pay)
– JoeTaxpayer♦
1 hour ago
Bob, when my wife had her appendix out, the bill was $24K, but hospital accepted $4K from insurance and our share was $800. I suspect a cash payer can negotiate a cash price between the $4K and the $24K. Our insurance system is broken. (Or one can believe that with no insurance, we’d be held to the $24K, making the insurance worth the $20K/yr we pay)
– JoeTaxpayer♦
1 hour ago
add a comment |
DaveInCaz is a new contributor. Be nice, and check out our Code of Conduct.
DaveInCaz is a new contributor. Be nice, and check out our Code of Conduct.
DaveInCaz is a new contributor. Be nice, and check out our Code of Conduct.
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Care to give a hint as to what the purchase is? Answers will be very different for "A new roof on our house" vs "That trip we've wanted."
– JoeTaxpayer♦
3 hours ago
@JoeTaxpayer thanks, edited
– DaveInCaz
2 hours ago