Amazon Store Card Equal Pay vs Special Financing

[PerArduaAdAstra]

I'm having a hard time finding the differences between these two financing options with the Amazon Store Card issued by Synchrony Bank. Could anyone shed some light?

And is it accurate that with the Equal Pay option the balance will go to a special "Promotional Balance" category and not on the regular Statement Balance of the card? I've read that the Chase VISA will go on Statement Balance, but the Sync Store card won't.

Thank you.

[Anonymous]

I have never used either of them but I can tell you one key difference is that equal pay is split equal payments. You have to make the payment every month that will get it paid off in that time period but it's with no interest risk. I would rather have the flexibility to continue to have a minimum payment with special financing. The downside being if you don't do the math right, you can end up having your financing run out and still have a balance and get hit with the deferred interest all the way to the beginning (ouch) but the upside being you can make any size payment you like as long as you make at least the minimum. 

Larger items I would finance with deferred interest and smaller ones I would use equal pay. The reason I haven't used either kind of offer yet is because I like getting rewards so I opened new cards for large purchases for SUBs and/or 0% but now that I have slowed down the apps, I may use the feature. 

[PerArduaAdAstra]

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@Anonymous wrote:

I have never used either of them but I can tell you one key difference is that equal pay is split equal payments. You have to make the payment every month that will get it paid off in that time period but it's with no interest risk. I would rather have the flexibility to continue to have a minimum payment with special financing. The downside being if you don't do the math right, you can end up having your financing run out and still have a balance and get hit with the deferred interest all the way to the beginning (ouch) but the upside being you can make any size payment you like as long as you make at least the minimum. 

Larger items I would finance with deferred interest and smaller ones I would use equal pay. The reason I haven't used either kind of offer yet is because I like getting rewards so I opened new cards for large purchases for SUBs and/or 0% but now that I have slowed down the apps, I may use the feature. 

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Thanks Sareen. So with Equal Pay I can't knock $1k off the balance right away? I'm locked into fixed monthly payments for 12 months?

I take it both Equal Pay and Special Financing with report as a regular balance to the bureaus? 

[Anonymous]

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@PerArduaAdAstra wrote:

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@Anonymous wrote:

I have never used either of them but I can tell you one key difference is that equal pay is split equal payments. You have to make the payment every month that will get it paid off in that time period but it's with no interest risk. I would rather have the flexibility to continue to have a minimum payment with special financing. The downside being if you don't do the math right, you can end up having your financing run out and still have a balance and get hit with the deferred interest all the way to the beginning (ouch) but the upside being you can make any size payment you like as long as you make at least the minimum. 

Larger items I would finance with deferred interest and smaller ones I would use equal pay. The reason I haven't used either kind of offer yet is because I like getting rewards so I opened new cards for large purchases for SUBs and/or 0% but now that I have slowed down the apps, I may use the feature. 

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Thanks Sareen. So with Equal Pay I can't knock $1k off the balance right away? I'm locked into fixed monthly payments for 12 months?

I take it both Equal Pay and Special Financing with report as a regular balance to the bureaus? 

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I am almost certain you can still make more than the equal pay amount, you just can't pay less. It likely just reduces the time that the equal pay runs for since obviously you would pay it quicker. Hopefully someone can chime in with more details here. 

It will report the balance either way but what I'm not sure of is if they add the equal payment to your minimum payment like AMEX does with Plan It. With AMEX if you make a plan, that plan payment gets added to your minimum and is reported to the credit bureaus that way so plans can massively increase your DTI. It could be worth finding out if equal pay will do the same. 

[K-in-Boston]

@Anonymous pretty much nailed it.  Put in simplest terms, let's use a $1000 purchase at 25% APR.

Equal Pay: you have 12 payments of $83.33* and it's paid off within a year.  That is your minimum payment each month unless there are additional balances in which case it is adjusted upward.  That balance WILL be paid no matter what in 12 months, even if you aren't pay in full on new charges (ouch).  Yes, you can ALWAYS pay extra and that will knock the balances down on equal pay and reduce the number of payments you need to make.

Special Financing:

• If you make no other purchases, you pay $83.33* per month and your balance is gone in 12 months as long as you don't make any new purchases. 
• If you make no other purchases, but you make the minimum payment of $27 every month, on your 12th statement you would have a balance of $703 - if you make the minimum payment of $27 instead of paying the full $703, your next statement will be $926 ($676 balance after 12 payments of $27 plus the $250 in retroactive interest you just accrued for a $1000 purchase a year ago at 25% APR).
• Things get tricky when you have more than one promotional balance and/or continue to make new purchases to get the 5% back for example.  Synchrony offers a few ways to set up how your payments are applied.  There are too many scenarios to list them all, but if you had the $1000 purchase on a 12 month no interest promo and made $100 in new purchases, I'd pay at least the minimum payment + new charges + 1/n of your remaining promotional balance where "n" is the number of months you hjave left before a promo expires.
• If you have multiple special financing offers (this happens to me even on the same order as multiple shipments will have their own entries), the payments will be applied to the balance(s) ending on the earliest date, but if you have things expiring on the same date the payment gets distributed to each of those so if you have a $900 balance and a $100 balance ending on the same day and make a $100 payment, you'd probably have a $810 and $90 balance rather than the $100 all going to the $900 balance or knocking out the $100 balance.

*This is obviously rounding, so every 3rd payment needs to be $83.34 - you don't want to accrue $250 in retroactive interest because you still had a $0.04 balance, and yes that would happen.