topic Re: Chase payment plan for a large purchase on chase credit card in Credit Cards

Chase payment plan for a large purchase on chase credit card

red259 — Mon, 06 Dec 2021 00:58:38 GMT

I saw chase is offering me a payment plan for a large purchase I made with one of my cards. Other than the monthly fee that they would charge as part of the payment plan is there a downside to taking advantage of this? I wouldn't mind putting this payment off for a month while vendor payments for the end of the year come in vs having to move money around from my other accounts. They claim there is no other interest charges and that I can pay it off completely without penalty.

Re: Chase payment plan for a large purchase on chase credit card

Yasselife — Mon, 06 Dec 2021 01:10:13 GMT

@red259

I have tried it twice, and It's true to its word; I paid back early with no penalty.

Re: Chase payment plan for a large purchase on chase credit card

NRB525 — Mon, 06 Dec 2021 02:08:14 GMT

These new offerings from AMEX, Chase, US Bank and others are a fixed fee per month. No interest charges in addition.

With AMEX the Plan It items are separate from other purchases, so those other purchases don't trigger interest charges either. I would presume Chase Plans are the same way, distinct from other purchase balances, to keep those from charging interest. This, however, is an assumption, and it would be good to get confirmation from others that Chase indeed separates those charges to prevent interest.

Re: Chase payment plan for a large purchase on chase credit card

aynot4fitness — Mon, 06 Dec 2021 03:49:15 GMT

This is actually a pretty good deal from Chase and a few others. I had 2 purchases that qualified recently, so I compared the cost of the payment plan to the cost of regular purchase interest. The payment plan was the equivalent of about 13% annualized interest. My regular purchase interest rate is 23.74%, so the payment plan does lower the cost of financing quite a bit. You save even more by paying it off early. This option seems to be just what you need, so go for it!

Re: Chase payment plan for a large purchase on chase credit card

SouthJamaica — Mon, 06 Dec 2021 03:55:14 GMT

@red259 wrote:
I saw chase is offering me a payment plan for a large purchase I made with one of my cards. Other than the monthly fee that they would charge as part of the payment plan is there a downside to taking advantage of this? I wouldn't mind putting this payment off for a month while vendor payments for the end of the year come in vs having to move money around from my other accounts. They claim there is no other interest charges and that I can pay it off completely without penalty.

I know I'm in a minority on this, but I never accept those offers. They seem like traps to me.

Re: Chase payment plan for a large purchase on chase credit card

Curious_George2 — Mon, 06 Dec 2021 04:04:05 GMT

@NRB525 wrote:
These new offerings from AMEX, Chase, US Bank and others are a fixed fee per month. No interest charges in addition.

With AMEX the Plan It items are separate from other purchases, so those other purchases don't trigger interest charges either. I would presume Chase Plans are the same way, distinct from other purchase balances, to keep those from charging interest. This, however, is an assumption, and it would be good to get confirmation from others that Chase indeed separates those charges to prevent interest.

Your assumption is correct. When you put charges in a My Chase Plan, your statement will show a Minimum Payment and also what they call an "Interest Saving Balance." The ISB consists of your scheduled monthly payment under the Plan, plus your total balance of non-Plan charges. If you pay the ISB, you don't incur any interest charges. Here's how they explain it on the statement: "By paying your Interest Saving Balance each billing period by your due date, you will avoid interest on purchases appearing on your next statement."

Re: Chase payment plan for a large purchase on chase credit card

Curious_George2 — Mon, 06 Dec 2021 04:15:49 GMT

@SouthJamaica wrote:
I know I'm in a minority on this, but I never accept those offers. They seem like traps to me.

I have always been pretty skeptical of them too. Chase surprised me by offering no-fee My Chase Plans for some Southwest purchases I made on my Southwest card. Curiosity took over and I decided to try it. I'm in the midst of it now, but so far, so good. There doesn't seem to be a catch.

Of course, much depends on how high the fee is. And the calculations required to understand its APR equivalent might test the limits of some people's math skills. I had it pretty easy this time, with zero.

Re: Chase payment plan for a large purchase on chase credit card

NRB525 — Mon, 06 Dec 2021 11:13:58 GMT

@SouthJamaica wrote:
@red259 wrote:
I saw chase is offering me a payment plan for a large purchase I made with one of my cards. Other than the monthly fee that they would charge as part of the payment plan is there a downside to taking advantage of this? I wouldn't mind putting this payment off for a month while vendor payments for the end of the year come in vs having to move money around from my other accounts. They claim there is no other interest charges and that I can pay it off completely without penalty.
I know I'm in a minority on this, but I never accept those offers. They seem like traps to me.

They are not "traps".

For short term funding of a month or two, such as the OP is considering, they are excellent low APR cash flow management tools. The Plan keeps these charges separate from ongoing charges added to the card, which makes it extremely easy to pay them off and have the interest-free grace period unaffected by the entire sequence.

Your assignment is to research these a bit more, and try using a Chase Plan, an AMEX Plan It, or the US Bank version for financing $200 or so. These are new innovations that are best experienced directly on a small scale, rather than presuming nefarious intent. I've used AMEX Plan It several times since it was introduced.

Re: Chase payment plan for a large purchase on chase credit card

NRB525 — Mon, 06 Dec 2021 11:15:22 GMT

@Curious_George2 wrote:
@NRB525 wrote:
These new offerings from AMEX, Chase, US Bank and others are a fixed fee per month. No interest charges in addition.

With AMEX the Plan It items are separate from other purchases, so those other purchases don't trigger interest charges either. I would presume Chase Plans are the same way, distinct from other purchase balances, to keep those from charging interest. This, however, is an assumption, and it would be good to get confirmation from others that Chase indeed separates those charges to prevent interest.
Your assumption is correct. When you put charges in a My Chase Plan, your statement will show a Minimum Payment and also what they call an "Interest Saving Balance." The ISB consists of your scheduled monthly payment under the Plan, plus your total balance of non-Plan charges. If you pay the ISB, you don't incur any interest charges. Here's how they explain it on the statement: "By paying your Interest Saving Balance each billing period by your due date, you will avoid interest on purchases appearing on your next statement."

Thanks for confirming.

Re: Chase payment plan for a large purchase on chase credit card

Anonymous — Mon, 06 Dec 2021 20:18:40 GMT

@NRB525 wrote:
@SouthJamaica wrote:
I know I'm in a minority on this, but I never accept those offers. They seem like traps to me.
They are not "traps".

For short term funding of a month or two, such as the OP is considering, they are excellent low APR cash flow management tools. The Plan keeps these charges separate from ongoing charges added to the card, which makes it extremely easy to pay them off and have the interest-free grace period unaffected by the entire sequence.

Your assignment is to research these a bit more, and try using a Chase Plan, an AMEX Plan It, or the US Bank version for financing $200 or so. These are new innovations that are best experienced directly on a small scale, rather than presuming nefarious intent. I've used AMEX Plan It several times since it was introduced.

I agree that they are not per se nefarious (that is what my Grand Master ordered me to say) but things can be traps in other ways. Most people on here know that ideally you shouldn't carry a balance (high APRs, interest on all purchases etc) but as these lack those issues, you might be tempted to take the plan when you could PIF, and thus...... In other words, a gateway drug to FINANCIAL DISASTER, lets ask Dave R for an unbiased view!

As with many things, a reasonable financial tool if you understand the costs and believe they outweigh other options.

Re: Chase payment plan for a large purchase on chase credit card

Remedios — Mon, 06 Dec 2021 20:26:16 GMT

Also, if you've created such a plan with US Bank, it's completely excluded from reported utilization on your card (for those who still struggle with the idea of letting cards report a balance).

Funny way to do it, but that's how they set it up.

Re: Chase payment plan for a large purchase on chase credit card

Remedios — Mon, 06 Dec 2021 20:41:33 GMT

@SouthJamaica wrote:
@red259 wrote:
I saw chase is offering me a payment plan for a large purchase I made with one of my cards. Other than the monthly fee that they would charge as part of the payment plan is there a downside to taking advantage of this? I wouldn't mind putting this payment off for a month while vendor payments for the end of the year come in vs having to move money around from my other accounts. They claim there is no other interest charges and that I can pay it off completely without penalty.
I know I'm in a minority on this, but I never accept those offers. They seem like traps to me.

SJ, may I ask why?

You've stated before you carried balance on some cards, so how is this any different?

It's a structured payment plan, and because it's structured, both you and lender know what to expect in terms of payment amounts

If anything, this is a safer alternative when it comes to AA since it's almost like a contract within a contract when compared to arbitrary amounts one may decide to pay when carrying a balance.

Re: Chase payment plan for a large purchase on chase credit card

Anonymous — Mon, 06 Dec 2021 20:49:31 GMT

@SouthJamaica wrote:
I know I'm in a minority on this, but I never accept those offers.

Me either, except for once to try it and keep activity on an unused card because the fee was lower than the typical BT fee. While the "fee" on these offers can be very low in some cases, I personally prefer to utilize BT's at zero percent.

Re: Chase payment plan for a large purchase on chase credit card

Curious_George2 — Mon, 06 Dec 2021 23:01:32 GMT

@Remedios wrote:
Also, if you've created such a plan with US Bank, it's completely excluded from reported utilization on your card (for those who still struggle with the idea of letting cards report a balance).
Funny way to do it, but that's how they set it up.

Wow! That's very nice of them. Chase doesn't do that.

Re: Chase payment plan for a large purchase on chase credit card

Remedios — Mon, 06 Dec 2021 23:26:24 GMT

@Curious_George2 wrote:
@Remedios wrote:
Also, if you've created such a plan with US Bank, it's completely excluded from reported utilization on your card (for those who still struggle with the idea of letting cards report a balance).
Funny way to do it, but that's how they set it up.
Wow! That's very nice of them. Chase doesn't do that.

Yup, those charges are separated and it's treated like installment loan.

Amount in the "loan" is not reported, card reports with CL intact, so it remains hidden.

When you make a payment, it increases available credit on your card untill paid off.

It's clunky and great at the same time.

Re: Chase payment plan for a large purchase on chase credit card

SouthJamaica — Tue, 07 Dec 2021 05:06:39 GMT

@Remedios wrote:
@SouthJamaica wrote:
@red259 wrote:
I saw chase is offering me a payment plan for a large purchase I made with one of my cards. Other than the monthly fee that they would charge as part of the payment plan is there a downside to taking advantage of this? I wouldn't mind putting this payment off for a month while vendor payments for the end of the year come in vs having to move money around from my other accounts. They claim there is no other interest charges and that I can pay it off completely without penalty.
I know I'm in a minority on this, but I never accept those offers. They seem like traps to me.

SJ, may I ask why?
You've stated before you carried balance on some cards, so how is this any different?
It's a structured payment plan, and because it's structured, both you and lender know what to expect in terms of payment amounts
If anything, this is a safer alternative when it comes to AA since it's almost like a contract within a contract when compared to arbitrary amounts one may decide to pay when carrying a balance.

I expressed my reason, they feel like traps.

I never ever carry a balance on any of the cards I use for purchases or other spend. The only cards on which I ever carry a balance are low interest credit union cards used exclusively by me for cash advances and/or balance transfers, with average interest rates that are less than half the average APR on my rewards cards.

And frankly, I don't recommend carrying a balance even on those cards; it's just for me a matter of necessity, hopefully temporary.

Re: Chase payment plan for a large purchase on chase credit card

NRB525 — Tue, 07 Dec 2021 07:58:29 GMT

@SouthJamaica wrote:
@Remedios wrote:
@SouthJamaica wrote:
@red259 wrote:
I saw chase is offering me a payment plan for a large purchase I made with one of my cards. Other than the monthly fee that they would charge as part of the payment plan is there a downside to taking advantage of this? I wouldn't mind putting this payment off for a month while vendor payments for the end of the year come in vs having to move money around from my other accounts. They claim there is no other interest charges and that I can pay it off completely without penalty.
I know I'm in a minority on this, but I never accept those offers. They seem like traps to me.

SJ, may I ask why?
You've stated before you carried balance on some cards, so how is this any different?
It's a structured payment plan, and because it's structured, both you and lender know what to expect in terms of payment amounts
If anything, this is a safer alternative when it comes to AA since it's almost like a contract within a contract when compared to arbitrary amounts one may decide to pay when carrying a balance.

I expressed my reason, they feel like traps.

I never ever carry a balance on any of the cards I use for purchases or other spend. The only cards on which I ever carry a balance are low interest credit union cards used exclusively by me for cash advances and/or balance transfers, with average interest rates that are less than half the average APR on my rewards cards.

And frankly, I don't recommend carrying a balance even on those cards; it's just for me a matter of necessity, hopefully temporary.

So, the OP comes here with a question related to a temporary necessity of carrying a balance for a month or two, and your response is ... ?

Re: Chase payment plan for a large purchase on chase credit card

Remedios — Tue, 07 Dec 2021 16:09:42 GMT

@SouthJamaica wrote:
@Remedios wrote:
@SouthJamaica wrote:
@red259 wrote:
I saw chase is offering me a payment plan for a large purchase I made with one of my cards. Other than the monthly fee that they would charge as part of the payment plan is there a downside to taking advantage of this? I wouldn't mind putting this payment off for a month while vendor payments for the end of the year come in vs having to move money around from my other accounts. They claim there is no other interest charges and that I can pay it off completely without penalty.
I know I'm in a minority on this, but I never accept those offers. They seem like traps to me.

SJ, may I ask why?
You've stated before you carried balance on some cards, so how is this any different?
It's a structured payment plan, and because it's structured, both you and lender know what to expect in terms of payment amounts
If anything, this is a safer alternative when it comes to AA since it's almost like a contract within a contract when compared to arbitrary amounts one may decide to pay when carrying a balance.

I expressed my reason, they feel like traps.

I never ever carry a balance on any of the cards I use for purchases or other spend. The only cards on which I ever carry a balance are low interest credit union cards used exclusively by me for cash advances and/or balance transfers, with average interest rates that are less than half the average APR on my rewards cards.

And frankly, I don't recommend carrying a balance even on those cards; it's just for me a matter of necessity, hopefully temporary.

@SouthJamaica I read over my response several times to see if I've somehow indicated/stated you're recommending carrying a balance, and I don't see it. I certainly never witnessed it, so I'm not sure what's that about.

Plans like these (if one chooses to use them) allow you to preserve grace period on new charges so one can continue earning rewards while paying off plans.

I'm not advocating by any means everyone starts jumping on plans but it's viable option to those who need to stretch payments short term without bleeding money on interest.

The fees on these plans would be within the range of low interest rate on CU cards, so no different than what you said you're doing.

I truly don't have a 🐎 in this race, but using plan feature on some cards allows cardholders to save money on interest, reduce the need for BT cards chasing (usually when it's too late), create some reserve during months when cash flow isn't optimal, continue earning rewards on new purchases which can offset the fee, and potentially reduce risk of AA since if one wishes to preserve grace period there are no nilly willy payment amounts, I'm all for it.

Re: Chase payment plan for a large purchase on chase credit card

SouthJamaica — Tue, 07 Dec 2021 19:34:19 GMT

@Remedios wrote:
@SouthJamaica wrote:
@Remedios wrote:
@SouthJamaica wrote:
@red259 wrote:
I saw chase is offering me a payment plan for a large purchase I made with one of my cards. Other than the monthly fee that they would charge as part of the payment plan is there a downside to taking advantage of this? I wouldn't mind putting this payment off for a month while vendor payments for the end of the year come in vs having to move money around from my other accounts. They claim there is no other interest charges and that I can pay it off completely without penalty.
I know I'm in a minority on this, but I never accept those offers. They seem like traps to me.

SJ, may I ask why?
You've stated before you carried balance on some cards, so how is this any different?
It's a structured payment plan, and because it's structured, both you and lender know what to expect in terms of payment amounts
If anything, this is a safer alternative when it comes to AA since it's almost like a contract within a contract when compared to arbitrary amounts one may decide to pay when carrying a balance.

I expressed my reason, they feel like traps.

I never ever carry a balance on any of the cards I use for purchases or other spend. The only cards on which I ever carry a balance are low interest credit union cards used exclusively by me for cash advances and/or balance transfers, with average interest rates that are less than half the average APR on my rewards cards.

And frankly, I don't recommend carrying a balance even on those cards; it's just for me a matter of necessity, hopefully temporary.
@SouthJamaica I read over my response several times to see if I've somehow indicated/stated you're recommending carrying a balance, and I don't see it. I certainly never witnessed it, so I'm not sure what's that about.

Plans like these (if one chooses to use them) allow you to preserve grace period on new charges so one can continue earning rewards while paying off plans.
I'm not advocating by any means everyone starts jumping on plans but it's viable option to those who need to stretch payments short term without bleeding money on interest.
The fees on these plans would be within the range of low interest rate on CU cards, so no different than what you said you're doing.
I truly don't have a 🐎 in this race, but using plan feature on some cards allows cardholders to save money on interest, reduce the need for BT cards chasing (usually when it's too late), create some reserve during months when cash flow isn't optimal, continue earning rewards on new purchases which can offset the fee, and potentially reduce risk of AA since if one wishes to preserve grace period there are no nilly willy payment amounts, I'm all for it.

1. As I said, "I'm in a minority on this".

2. You didn't say that I recommend carrying balances. You said "You've stated before you carried balance on some cards, so how is this any different?" I answered your question, saying that it's different because I never carry balances on rewards cards, and explained on what cards I do carry balances. After explaining that, I thought I should mention that I only carry balances on the credit union cards out of necessity, not because I think it's a healthy practice. It stinks, just like owing any lender money, and paying any lender interest, stink.

Re: Chase payment plan for a large purchase on chase credit card

NRB525 — Wed, 08 Dec 2021 00:01:48 GMT

The Chase Plan, and AMEX Plan It allow one to carry part of a balance on a rewards card, without mucking up the grace period, continue to earn rewards on all spend without interruption, without a bunch of effort to shift the funds cost ( costs one will pay anyhow ) to a different card for a ~45 day cash flow purpose. That's a good thing.