These days it seems that just about everyone, from the local bank to the credit card company to the furniture and electronics store, is offering some sort of 0 APR offer. When used properly, this kind of super low interest rate can save you a lot of money on those major purchases, but it is important to carefully read the fine print in order to avoid getting burned.
That is because not every low interest rate offer is equally valuable. Some of these 0% APR offers come packed with hidden charges and fees, and there may be exorbitant interest rate charged on the back end if the purchase is not paid for within the allotted time. Other such offers may only be good on specific items, so it pays to make sure the 0% APR offer applies to the items you are considering.
In many cases, when stores offer this kind of financing offers there will be a minimum required purchase. For instance, a local home improvement warehouse may offer 0 APR financing on purchases above $300, while a local electronics store may offer such a low or no interest rate incentive on purchases of select televisions and video equipment. It is always important to read the fine print carefully, and to ask questions if you are unsure of the terms.
In many cases, these kinds of financing offers will be good only on a specific purchase, and other items purchased with the same credit card, or from the same store, will accrue interest charges. Therefore, it is vital to carefully read your statement each month to make sure that you do not owe interest on other purchases. If you purchase other items that are not covered by the 0 APR offer, it is a good idea to pay in full for those items in order to avoid accruing interest charges.
It is also important to pay off any items purchased through any kind of low or no interest rate offer within the agreed upon time. Often the store will provide 2 years, 3 years or even 4 or more years of 0 Apr financing, but after that the interest charges will most likely revert to their normally high level. It is important to pay attention to just when the payment is due, and to pay off the purchases while you are still in the 0 APR time period.
The bottom line is that 0 APR financing can be a great deal, but only if you understand the terms and conditions and use them to your advantage. |
