I know you all aren't attorneys so I'm not asking for legal advice. I can get that from work. I guess this is more of an informative post to make people aware of this financing tactic.
I usually do not use store credit but sometimes it is tempting when they offer that 0% interest for 24 months, etc.
However, in reviewing my credit card statements for Rooms to Go (GE MONEY), I forsee a problem.
When I bought furniture there, I bought it under one of those 0% interest promotions.
I purchased furniture on 4/2010 in the amount of $3,019.
The promotion was "equal payments no interest" - in fact that is STILL what it says on the promotional summary when I log into my account.
Now, I had it on "autodraft" and I have never been late. My payments had been the same every month from April 2010 until April 10, 2011 when the adjusted my "equal payments no interest" payment downward about $25.00 per month. I called at that time and she said that the account was adjusted to reflect equal payments no interest through the duration of the promotional period and told me that the account would be paid off before the promotional period expires as they currently have it set up.
:/
Now, this promotional period ends 12/31 this year.
My balance is $1,226.62 and I pay $94/mo. The payment for this month has not yet been made.
So I have 11 payments essentially before this "deal" expires. That's $1,034 more worth of payments leaving me with a deficit of 192.62 as of 12/31/2012 when their promotion expires.
My understanding is that if you do not pay this account off in time, they charge you compounded interest from the date of the original transaction. I feel like they have set me up. If the payment had remained at the original amount before they "adjusted it in my favor" last year, it would have paid itself off on time.
Is this a tactic GE Money uses frequently?
I'm not asking about how to fix this situation specifically. I will pay the amount off prior to the end of the year. That's not the problem. The problem is I know that not everyone watches their bills as closely as I do and I wanted to know if anyone else had experienced this. I also want people to be aware of this. I think it is unfortunate that they tell you they will pay it off zero percent interest in equal payments and then adjust your account to purposely push you beyond the promotional period so that interest can accrue. There is nothing prohibiting me from making additional payments. That, however, is not the point.
Actually, at least for Care Credit, your minimum payment due is just 3% of whatever the balance is. Its a revolving account so you can pay it off whenever you want. If you specifically want to pay it off within the promotional period, its your duty to make sure you're paying the correct amount. They're giving you 12,18,24 months no interest but your minimum payment is still 3% or $15 of whatever the revolving balance is.
