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Is It Worth Having a High Balance for a Good Deal?

Senior Contributor

Re: Is It Worth Having a High Balance for a Good Deal?

Musiclover, out of curiosity what are the details of the 0% interest purchase offer?  How long do you have to pay it off, and realistically how quickly do you think you'd pay off that $16k?

Message 11 of 26
Community Leader
Super Contributor

Re: Is It Worth Having a High Balance for a Good Deal?


donny10 wrote:

Musiclover wrote:

Thanks for all your thoughts. I will keep you posted as this progresses.


It is well worth it if your saving many hundreds in interest. Stay the course and do what your comfortable with. It's a temporary score drop that will recover and then some. Showing your creditors you have used a big portion of a credit line and paid it down, thus proving responsible use and creditworthiness.

 

Credit is there to use. Use it.


That was my thinking, as well, donny. I could have easily used their two year financing with 7.8% interest (I think that is the right number), but why when I can have zero interest? Anyway, that was and is my thinking now.


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Message 12 of 26
Community Leader
Super Contributor

Re: Is It Worth Having a High Balance for a Good Deal?


BrutalBodyShots wrote:

Musiclover, out of curiosity what are the details of the 0% interest purchase offer?  How long do you have to pay it off, and realistically how quickly do you think you'd pay off that $16k?


I have 24 months to pay the 16k without any interest. I will probably use about 18 months to pay, although I put the full 24 months in my budget.


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Message 13 of 26
Senior Contributor

Re: Is It Worth Having a High Balance for a Good Deal?

Understood.  My only concern would be if you were planning on buying a house any time in the next 4 years then... as it would be in your best interest to have that balance completely paid off and you go back to carrying no balances 2 years prior to a mortgage application.

Message 14 of 26
Established Contributor

Re: Is It Worth Having a High Balance for a Good Deal?

ML if you're putting a new roof on your house, I assume you are not in the immediate market for a mortgage. 

 

Sometimes we put FICO score over what makes financial sense.  The easiet factor of the FICO score that it in your control is utilization.  It is also the most fluid component, and does not take historical data into account.  

 

I say do what makes financial sense and it appears that 0% for a new roof is a good financial move.  

 

I remodeled my kitchen on Lowes, and **bleep** near maxed it out.  No AA whatsoever, and while moving limits on Chase had the pleasure of speaking to lending.  Since it was a home improvement credit card it was very easy to explain the large balance. 

 

You've indicated that you have no plans to apply for new credit, so enjoy your new roof (also adds value to home)

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Message 15 of 26
Community Leader
Super Contributor

Re: Is It Worth Having a High Balance for a Good Deal?


BrutalBodyShots wrote:

Understood.  My only concern would be if you were planning on buying a house any time in the next 4 years then... as it would be in your best interest to have that balance completely paid off and you go back to carrying no balances 2 years prior to a mortgage application.


No new home for me. I own my home free and clear and will spend the next five years working remodeling projects. The roof is just step one.


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Message 16 of 26
Community Leader
Super Contributor

Re: Is It Worth Having a High Balance for a Good Deal?


Kidcat wrote:

ML if you're putting a new roof on your house, I assume you are not in the immediate market for a mortgage. 

 

Sometimes we put FICO score over what makes financial sense.  The easiet factor of the FICO score that it in your control is utilization.  It is also the most fluid component, and does not take historical data into account.  

 

I say do what makes financial sense and it appears that 0% for a new roof is a good financial move.  

 

I remodeled my kitchen on Lowes, and **bleep** near maxed it out.  No AA whatsoever, and while moving limits on Chase had the pleasure of speaking to lending.  Since it was a home improvement credit card it was very easy to explain the large balance. 

 

You've indicated that you have no plans to apply for new credit, so enjoy your new roof (also adds value to home)


No mortage in my future, Kidcat. I am so guilty of putting my score first before common sense, sometimes. Zero financing is definitely a good financial decision, I agree.

 

I will keep watch on my scores and pay off my roof without spending a penny on interest. My overall utilization will still be about 9% even with the new roof. As I said, I will keep everyone posted for data points. 

 

Thanks again to everyone for taking time to give your opinions. I love this forum!Smiley Happy


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Message 17 of 26
Senior Contributor

Re: Is It Worth Having a High Balance for a Good Deal?

Enjoy the new roof! Completely off the discussion topic, but could you give some info on the roof? I've been putting off replacing mine for 5-10 years, lol. What part of the country do you live in and did you shop around for different roofers? Are you buying materials at Lowe's or do they do installation as well?
Message 18 of 26
Community Leader
Super Contributor

Re: Is It Worth Having a High Balance for a Good Deal?


BrutalBodyShots wrote:
Enjoy the new roof! Completely off the discussion topic, but could you give some info on the roof? I've been putting off replacing mine for 5-10 years, lol. What part of the country do you live in and did you shop around for different roofers? Are you buying materials at Lowe's or do they do installation as well?

My home is outside of Houston in a rural area. I had several companies give me estimates and took the one I liked the best. 


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Message 19 of 26
Valued Contributor

Re: Is It Worth Having a High Balance for a Good Deal?

Getting the roof is most important thing. HD does a great job and price on roofs. We used them on my mom's house about 10 years ago. They were about 1/3 below the others. 

Message 20 of 26