Using 0% Credit Card to Pay Off Car?

Hooosier · ‎05-30-2013

I was recently approved for the Discover It card with 0% for 14 months. My car loan has approximately 3K left on it. I've thought about using the credit card to pay off the car so that I won't be paying interest on it any more (I would be able to pay it off well before the 14 months at 0% are up). Would this be a terrible idea?

203bravo · ‎05-30-2013

Does your current finance company accept credit cards? If so then this may not be such a bad idea... However if they do not and you have have to do a balance transfer or convience check from Discover then I probably wouldn't do it because of the fee involved... you would end up saving the money anyway by just going ahead and paying this car off as fast as you can.. espeically since you have plans to pay it off in the 14 months anyway.... also if for any reason something happened and you couldn't end up paying off this loan within the promo period it stands to reason that the interest rate that Discover is going to charge you will be much higher than your current auto loan.

webhopper · ‎05-31-2013

On a BT, the car company doesn't have to accept Credit Cards... Discover will issue either an ACH or a paper check to the finance company to pay off the loan..

If I were in your shoes I would definately do it! Do the math on the 3% BT fee versus what you would be paying in interest before deciding to proceed with the BT.

Or just wait a month or two and check to see if you have a BT offer that involves $0 BT fee in exchange for a rate like 2.9% or 1.99%... I get these offers quite a bit on my Discover...

Congrats on paying off your car!

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Hooosier · ‎05-31-2013

@webhopper wrote:
On a BT, the car company doesn't have to accept Credit Cards... Discover will issue either an ACH or a paper check to the finance company to pay off the loan..

If I were in your shoes I would definately do it! Do the math on the 3% BT fee versus what you would be paying in interest before deciding to proceed with the BT.

Or just wait a month or two and check to see if you have a BT offer that involves $0 BT fee in exchange for a rate like 2.9% or 1.99%... I get these offers quite a bit on my Discover...

Congrats on paying off your car!

I hadn't really thought of a bank not accepting a credit card for the payment, though I can understand why they may not. I think I might just wait for any BT offers to roll my way. I can't wait to pay this car off - it will be the first car I've ever owned outright!