Quote:
Originally Posted by Koa
fully agree there- time value of money alone states that you're getting more for your buck by spreading the cash out over the course of the loan period.
The financing entity knows this, and if it's in-house, they'll pass that benefit on to you in order to book a sale. Scratch your back, you scratch mine kinda thing  |
Not picking a fight with you based on any history, this is a pet peeve of mine...
Financing a turbo kit. While what you say is technically true, this is reckless consumerism. Really terrible advice unless the OP is in such a place where he has at least $4000 in cash burning a hole in his pocket and would rather secure a 0% credit line spread over 12 months while allowing some portion of the $4000 to earn interest in a safe place. Is ~$150 in interest worth the ridiculous penalties most of these loans come attached with should you not pay in the 12 months agreed upon? At 28% interest backdated to the start of the loan, you would owe an additional $632 at 1 year and 1 day and the interest starts to roll over from there. This is how most 1 year 0% consumer loans and credit cards trap stupid/unlucky people.
Just don't do it. Be responsible and save up and buy the kit cash. This isn't something you need. Things like FI kits tend to get expensive really fast if something goes wrong. If you don't even have the cash to buy the kit to begin with, how are you going to afford to fix something that breaks? If nothing else, make sure to read all the fine print and see if exactly what happens if you don't pay the loan off in 1 year. Almost all loans like this aren't handled in house, they are farmed out to a partner bank which will have a structure exactly like I described.