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amnesian1
Posts: 7
Registered: ‎05-03-2007
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Same-as-cash Financing

I am in need of building credit, so I purchased a TV using a no-money-down, same-as-cash plan with a minimum monthly payment for 3 years. Purchase amount $3,000; credit limit $10,000.
 
Since this is a 30% utilization, what is the best way to build credit? Should I immediately pay down to 10% utilization, then maintain small monthly payments for as long as possible? Or should I slowly reduce my utilization over the next 3 years?
Senior Contributor
smallfry
Posts: 4,831
Registered: ‎04-20-2007
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Re: Same-as-cash Financing

If its a no interest loan its a tough call. If you are paying interest I would pay the line down to under 10%. I'd be tempted to pay it down anyway.
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Brammy
Posts: 5,436
Registered: ‎03-10-2007
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Re: Same-as-cash Financing



amnesian1 wrote:
I am in need of building credit, so I purchased a TV using a no-money-down, same-as-cash plan with a minimum monthly payment for 3 years. Purchase amount $3,000; credit limit $10,000.
 
Since this is a 30% utilization, what is the best way to build credit? Should I immediately pay down to 10% utilization, then maintain small monthly payments for as long as possible? Or should I slowly reduce my utilization over the next 3 years?


 
Is this a credit card such as Best Buy? or an insotre account?  If it is an instore account it may be handled by a finance company which can actualy HURT your score.  That being said it may also simply report your high balance as a FI company.  If it IS an actual credit card.  I would take advantage of the 0% for as long as I could just remember to pay slightly more than the minimum.  You can always apply for revolving credit and not use it for much.  the cumulative card balances are what counts.

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Tuscani
Posts: 6,182
Registered: ‎03-29-2007
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Re: Same-as-cash Financing

Assuming it is Best Buy... Best Buy uses HSBC which will be revolving.
New Member
amnesian1
Posts: 7
Registered: ‎05-03-2007
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Re: Same-as-cash Financing

I appreciate all the replies. I continue to be amazed by the quality of the posts in this forum.
 
It is a revolving credit line provided by GE Money Bank (GEMB). And it is 0% until 2009. Since I initiated this purchase strictly to build credit, I think I will pay down to 10% utilization, and then finish paying it before 2009 (before I am assessed finance charges)
 
they also provided me a credit card, branded by Tweeter (the store I made this purchase). I never activated it. The card's brochure says "no interest if paid within 90 days." Is it possible that purchases made on the card have different terms than the original purchase that opened the credit line (as appears to be the case)?
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Tuscani
Posts: 6,182
Registered: ‎03-29-2007
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Re: Same-as-cash Financing



amnesian1 wrote:
I appreciate all the replies. I continue to be amazed by the quality of the posts in this forum.
 
It is a revolving credit line provided by GE Money Bank (GEMB). And it is 0% until 2009. Since I initiated this purchase strictly to build credit, I think I will pay down to 10% utilization, and then finish paying it before 2009 (before I am assessed finance charges)
 
they also provided me a credit card, branded by Tweeter (the store I made this purchase). I never activated it. The card's brochure says "no interest if paid within 90 days." Is it possible that purchases made on the card have different terms than the original purchase that opened the credit line (as appears to be the case)?


Yes it is possible. I havn't heard of tweeter, but GEMB is very reputable. As Brammy suggestioned, depending how they report, it could bring your score down in the short term, however, I would not let the stop you from getting the TL to help build up your file and increase your scores over the long term.
Moderator Emeritus
Brammy
Posts: 5,436
Registered: ‎03-10-2007
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Re: Same-as-cash Financing



amnesian1 wrote:
I appreciate all the replies. I continue to be amazed by the quality of the posts in this forum.
 
It is a revolving credit line provided by GE Money Bank (GEMB). And it is 0% until 2009. Since I initiated this purchase strictly to build credit, I think I will pay down to 10% utilization, and then finish paying it before 2009 (before I am assessed finance charges)
 
they also provided me a credit card, branded by Tweeter (the store I made this purchase). I never activated it. The card's brochure says "no interest if paid within 90 days." Is it possible that purchases made on the card have different terms than the original purchase that opened the credit line (as appears to be the case)?


 
Is it possible that the card is the revolving credit issued by GEMB?  I would call to check the limit and the balance because if so you activated it by the purchase.  That being said I would prefer it to report that way because that gives you a credit card with a high credit line.  And yes they can have different financinf terms, the statement would just break it out line by line as far as interest and expiration date of offer.  My Best buy card does that.
 
Just be careful if thats the case if your thinking of buying anything else.  When the payments are made they are generally made to the purchase that has the more favorable terms first.  So if you make an additinal purchase of 1000.00 and the regular interest rate is 18% all your payments will go towards that sweet long term 0% before a dime is applied to the other balance.  Making that interest constantly revolve until you pay off the first purchase completely

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smallfry
Posts: 4,831
Registered: ‎04-20-2007
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Re: Same-as-cash Financing

Sorry if I am misunderstanding the question but both Walmart and my 6th Avenue Electronics lines of credit use GE Money Bank and they report high credit and credit limit. I think that's a good thing.
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Brammy
Posts: 5,436
Registered: ‎03-10-2007
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Re: Same-as-cash Financing



smallfry wrote:
Sorry if I am misunderstanding the question but both Walmart and my 6th Avenue Electronics lines of credit use GE Money Bank and they report high credit and credit limit. I think that's a good thing.

 
The OP didn't orignially state it was a card just a revolving line of credit ... two different things.   Still don't know if the purchase is reported on the card or if they have two separate accounts.

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LadyFICO
Posts: 273
Registered: ‎04-13-2007
0

Re: Same-as-cash Financing

Once you resolve whether it is revolving and the seperate terms of the tweeter account, It sounds like paying it down like you are thinking is the way to go. Your util would report at 30% then you will turn around and have it report at 10%. Then ride out your 0% as long as you pay more than the minimum each month and if any is left when they get ready to add charges pay it off. Look into what your finance charges would be after the 2009 date if itis reasonable enough you may consider keeping a small balance on it and keep making payments! Good Luck!    

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