Your £25 charge is the interest. Credit card with 0% for 'x' months doesn't have such a charge.
Somebody help me with finance! This is confusing!
- Thread starter MrElve
- Start date
Your £25 charge is the interest. Credit card with 0% for 'x' months doesn't have such a charge.
EDIT:
According to that which the website says, It's a 3-4 year payment plan which has a starting 6 months of no payments with no interest. When the first 6 months are over (or before the six month date) you have the choice of paying the full price of your item with a £25 early settlement fee and then everything is sorted, OR, begin monthly payments over (X) amount of time which will also include the fixed interest percentage, correct?
According to that which the website says, It's a 3-4 year payment plan which has a starting 6 months of no payments with no interest. When the first 6 months are over (or before the six month date) you have the choice of paying the full price of your item with a £25 early settlement fee and then everything is sorted, OR, begin monthly payments over (X) amount of time which will also include the fixed interest percentage, correct?
Last edited:
Even though it's a £25 'charge' it's still interest, if you can't see that a credit card with 0% interest for 'x' months and no 'charge' is better then I don't know how to make it clearer.
However I suppose the others haven't thought about whether you can get a credit card or not so that BNPL option is your only choice.
However I suppose the others haven't thought about whether you can get a credit card or not so that BNPL option is your only choice.
I got my laptop from OcUK on the buy now pay 6 months later. Completely forgot about it, but luckily enough i came across the paperwork whilst searching for something. Had like 5 days to pay it up, so i did.
Turned out if i did forget to pay, the £1k would have turned into about £2400
Turned out if i did forget to pay, the £1k would have turned into about £2400
![[TW]Fox](/data/man-of-honor/2009.png){kind=avatar}
Nothing to do with the banking sector? Oh come on
You know I'm certainly not a 'banking basher' but the banking sectors involvement in house prices is simple economics.Price is the point at which supply and demand meet. The more money you give people access to, the higher the amount they are able to/prepared to pay for a house becomes. This increases price.
The easier and bigger mortgages became, the bigger everyones budget for house prices, which contributed to the inflation in house prices.
In exactly the same way that if you gave everyone in the UK a million quid, everything they'd buy with it would become more expensive.
[TW]Fox;22135845 said:
Although you are indeed correct that with the fee of £25 the loan is not interest free, the APR is only 9.43% not 17% on the correct figure of £530.
Just saying but doesn't distract from your point about a 0% credit card being the cheaper option.
Soldato
- Joined
- 8 Mar 2007
- Posts
- 10,938
I don't think advising someone get a credit card to save a bit of cash on a one off purchase is as good advice as you want it to be.
With a credit card comes the ability to get credit whenever you want with no checks (i.e every time you use the card), not everyone is the Martin Lewis type that'll get the card, buy the camera then cut up the card.
I was persuaded into getting a credit card when I was 18 when I was actually after an overdraft. Told the same stuff you're saying, how it would be interest free for 30 days on anything I buy etc, etc.
I was at college at the time and I'd use the card to buy my lunch, a couple of quid here and there that'll all (so I thought) but by the time I'd finished my course I was over £2000 in debt.
At least with one off finance deals like the OP's been offered there's no further temptation to extended that credit.
It's good advice if the person can control themselves. You might not see it as good advice because you lost control of your card but I don't assume everyone is reckless and irresponsible.
A credit card is a really useful thing if you can control yourself. I had one when I was 16 (under my Dads main account) and nothing went out of control. Check finances->Buy with credit card if I have funds for it.
Soldato
- Joined
- 8 Mar 2007
- Posts
- 10,938
No I'm not, I'm providing a real world example where it can go wrong in response to your advice to someone you don't know (who sounds quite young and naive tbh) to get a credit card.
It is you who is making the assumption the OP would be responsible and not tempering your advice with any warnings, practically having a go and the guy for still asking about the deal he's been offered instead of running out to sign up for a 0% credit card.
All I'm doing is introducing one of the drawbacks of credit cards for the OP to think about. I'm not telling him what to do either way.
If you have the funds for something, why would need a credit card?
Regardless of whether you are responsible or not, it is always more logical and sensible to just save up and buy things when you can afford them instead of some future date whereby you end up each month paying off things you bought months ago.
It's slightly concerning that you keep referring to getting the camera for "free" because you don't need to pay anything upfront. This sounds like a terrible deal considering the 650D has just been announced.
FYI - You can pick up some great bargains now the 650D has been announced.
FYI - You can pick up some great bargains now the 650D has been announced.
Well maybe I don't take that stance on things because I can't imagine someone so stupid who would use it in the way you described (maybe I should).
Which is the default position to assume...
That wasn't having a go at him, but pointing out that the £25 charge is still 'interest'. You didn't see the pre-edited post so..
Neither am I
Oh I don't know...
Which is what most sensible people do with a credit card.
Soldato
- Joined
- 17 Dec 2004
- Posts
- 2,501
- Location
- Crawley, WEST SUSSEX
Also it is worth having a CC even if you dont' use it a huge amount as it helps your credit rating for the future. So anyone without one may struggle in getting future loans, mortgage etc. It shows, if your sensible with the card, a record of you being able to pay off the CC and a thus a good history.
I too would get a 0% CC if your sensible with it as then you save that £25. What you can also do is buy the camera, pay the minimum interest amount on the card and save the money up in a high interest savings account and then in the last month of the interest free period pay off the CC amount. Then you have earned interest on the money and you have your camera.
I too would get a 0% CC if your sensible with it as then you save that £25. What you can also do is buy the camera, pay the minimum interest amount on the card and save the money up in a high interest savings account and then in the last month of the interest free period pay off the CC amount. Then you have earned interest on the money and you have your camera.
Finance deal:
Camera cost: £530
Fee: £25
Total payable: £555 (if paid within 6 months)
CC with interest free purchase
Camera Cost: £530
Interest: £0
Total Payable: £530 (if paid within interest free offer period)
I'm not suggesting to get one over the other but that is what you would pay in both cases.
APR is annual though, so you need to take into account the fact its 25 quid for 6 months not 12.
[TW]Fox;22137427 said:
I did. hence it been 9.43% and not under 5%.
Since the £25 is not payable upfront (like an arrangement fee) and you are making one installment of £530 plus the £25 after 6 months, it doesn't affect the APR very much.
It would be different if paid at the front end.
But your overall point still stood, but saying it's 17% is a bit scary when it's a much more reasonable 9.43%.
Of course, most people, and proven on here, can;t see how a little £25 charge can equate to a reasonably high rate of interest.
Thanks for all the help guys, I got my camera today and it's all been made clear to me by the sales rep, thanks for all the input though, it's great to know there are people with this knowledge ready to help.
Thanks all
-Elve
Thanks all
-Elve
Thanks for all the help guys, I got my camera today and it's all been made clear to me by the sales rep, thanks for all the input though, it's great to know there are people with this knowledge ready to help.
Thanks all
-Elve
So you went with the finance option then
You don't need to be Martin Lewis, what a bizarre thing to say. Using a credit card is not difficult, just don't spend what you cannot afford to repay. It is daft to suggest we shouldn't advise the best way to save money if it involves a credit card simply because some people think as soon as they get acredit card they should go and max it out buying **** they cannot afford.
What next, don't recommend a car because some people might drive it into a wall?