Go | New | Find | Notify | Tools | Reply | |
Itchy was taken |
We have about 10k debt in "same as cash" with differing terms. I have the wherewithall to get rid of it but investments are paying well at the current time. It's not causing any difficulties in paying down. What to you pros think about flat retiring it vs paying off a 2.3% car or just sitting tight? _________________ This space left intentionally blank. | ||
|
Drill Here, Drill Now |
Is it dragging down your credit rating? One of the factors in your credit rating is percentage of credit used (credit used / credit limit). In my case, I'm about 10 months into a 16 month same as cash with a balloon final payment. I could pay it off now, but I'm only using 15% of its credit limit so I'm continuing with the low monthly payment then paying the balloon. Ego is the anesthesia that deadens the pain of stupidity DISCLAIMER: These are the author's own personal views and do not represent the views of the author's employer. | |||
|
A Grateful American |
It's simple math after the Credit Rating issue. If it is true "same as cash" no interest hidden or accruing, then let "your" money earn for you, while you use their money for free. Like using a credit card to purchase items you already are going to buy at a limited time discount, or to get something now that will not be available when you have cash, and then paying off the charge with that cash when you receive it and before you incur a charge, is "smart" use of the tool, aka money. Let the suckers pay the high interest rates and "finance" your making money while using someone else's money. "the meaning of life, is to give life meaning" ✡ Ani Yehudi אני יהודי Le'olam lo shuv לעולם לא שוב! | |||
|
Ammoholic |
Monkey is correct. Especially if you are going to liquidate a investment to pay it off. Jesse Sic Semper Tyrannis | |||
|
His Royal Hiney |
Just make sure you pay it off on time before any interest accrues. I used to like these Zero interest payment plans. But it just gnawed at me if I missed the due date. with being able to schedule bill pay now a days, it shouldn't be a problem. "It did not really matter what we expected from life, but rather what life expected from us. We needed to stop asking about the meaning of life, and instead to think of ourselves as those who were being questioned by life – daily and hourly. Our answer must consist not in talk and meditation, but in right action and in right conduct. Life ultimately means taking the responsibility to find the right answer to its problems and to fulfill the tasks which it constantly sets for each individual." Viktor Frankl, Man's Search for Meaning, 1946. | |||
|
Delusions of Adequacy |
as long as you pay it off on time, no problems. But many of those deals revert to very high rates if you don't, or if you make a late payment. I've always set up automatic payments on these deals, no worries about forgetting. I have my own style of humor. I call it Snarkasm. | |||
|
| I believe in the principle of Due Process  |
Don't forget to consider the risk to the investment in the time until you must pay the cash. If you will pay, say, $3000 in 6 months, what happens when that stock goes down instead of up, or the note secured by deed of trust or mortgage defaults? Deferred payment sales often can be bettered by offering cash now. Remember, liabilities are always 100% good, it's the assets you have to worry about. Luckily, I have enough willpower to control the driving ambition that rages within me. When you had the votes, we did things your way. Now, we have the votes and you will be doing things our way. This lesson in political reality from Lyndon B. Johnson "Some things are apparent. Where government moves in, community retreats, civil society disintegrates and our ability to control our own destiny atrophies. The result is: families under siege; war in the streets; unapologetic expropriation of property; the precipitous decline of the rule of law; the rapid rise of corruption; the loss of civility and the triumph of deceit. The result is a debased, debauched culture which finds moral depravity entertaining and virtue contemptible." - Justice Janice Rogers Brown | |||
|
| Itchy was taken |
"Remember, liabilities are always 100% good, it's the assets you have to worry about." This is the part that worries me. No, credit score is not suffering. Just my peace of mind. _________________ This space left intentionally blank. | |||
|
| Ammoholic |
If you need some piece of mind don't pay 0% int first pay the car note. I overpaid mine. It felt comforting to see the 0 payment due when I got the bill every month. If I hit a rough patch I could have skipped 6 months of payments before one would have been due. Jesse Sic Semper Tyrannis | |||
|
Nosce te ipsum |
A few years back I cancelled all my cards except two, lowered the limits to $10k each, and enacted a credit freeze. With the HELOC and a joint card, the agencies consider me to have four open accounts. Credit score is fine, not that I have any money to buy anything. With the credit freeze, I never apply for new credit because it will not go through. | |||
|
| Member |
You have a good dilemma & one that's probably not worth worrying about. Offering up cash now is not going to reduce the cost of the debt. It will reduce your gain (or possibly loss) from savings. Assuming investment growth, it's a net loss to pay off the debt early. Math & psychology don't always jive, though. If your investments are going well, I'd just make the payments and add to the investments/cash pool. That's what I'm doing on cars & furniture (2 cars, 2 rooms of furniture at less than 2%). Next time, I'll offer cash up front to reduce the overall cost (especially since interest rates are increasing). | |||
|
Member |
This is absolutely how I see it. I jump on 0 percent financing in my business and use their money not mine to get the things I need CMSGT USAF (Retired) Chief of Police (Retired) | |||
|
| Member |
I also used these in the past but have stopped. I stopped because I really have zero confidence in the finance company doing their job and closing the thing out properly. Never actually had it happened but if it would you are dealing with some moron trying to prove to them that it was in fact paid off on time. Just not worth the hassle for the meager return one can safely earn in today's low bank rate environment. | |||
|
Member |
Credit scores can be very reactive to small changes. My wife and I are debt free other than monthly credit card payments. We pay our cards in full each month and have for 20 years. I month ago we charged $10,000 on one of our cards. Our score dropped 32 points. We paid it of and it came back up 26 points to 830. We have over $50,000 in availability. Mike I'm sorry if I hurt you feelings when I called you stupid - I thought you already knew - Unknown ................................... When you have no future, you live in the past. " Sycamore Row" by John Grisham | |||
|
| Doin' what I can with what I got  |
Wait, what? Two questions: 1) Are you comfortably able to pay off the 10k same as cash? 2) Will your disposable, guaranteed, get you better than 2.3% return if invested? If it was me, I'd pay that car loan first. It's the only debt you listed that's costing you more money every month than you've already spent. After that, maintain your payments on the 10K and do what you want with the net. ---------------------------------------- Death smiles at us all. Be sure you smile back. | |||
|
eh-TEE-oh-clez |
You used up 20% of your available credit. The threshold for top tier credit scores is a debt to credit ratio of under 10%. One of the reasons to request increased credit limits periodically is to make sure your available credit is nice and cushy. Also, don't forget that Debt to Income is also a big deal. 10k on your credit card might push your total debt maintenance up over a threshold that also includes car payments, school loans, medical bills, and your mortgage. | |||
|
Member |
I personally would pay them off if I could because I don't like debt hanging over me. With the same as cash deals, if you miss a payment or come up 1 penny short at the end, you are screwed. Investments are doing well but it's not real money unless you liquidate, and the market could tank tomorrow, who knows. I would take some profits and use it to pay off the debt or bank it to pay off the debt. Just my personal opinion. | |||
|
| Unapologetic Old School Curmudgeon  |
I've always felt no debt is the best debt. Once the debt is gone you can do whatever you want, invest in what you want, etc. Don't weep for the stupid, or you will be crying all day | |||
|
| Not all who wander are lost.  |
I agree. The borrower is slave to the lender. Pay it off and move on with your money. If everything goes as you plan it to go, it still wouldn't even be a drop in the bucket of your net worth. Its risky. You never know whats around the corner and when it happens, you don't want to be owing people money. Posted from my iPhone. | |||
|
| Powered by Social Strata |
 | Please Wait. Your request is being processed... |
|
© SIGforum 2024