when they say "no payments, no interest" for x amount of time...

Do they mean you PAY no interest or that you ACCRUE no interest?

We pay cash for everything except our home and cars - if we can't afford it, we wait until we can.

We are getting new appliances soon and some places sometimes advertise "No payments AND no interest" for 12 months or whatever... Is it REALLY no interest, meaning, if I paid it off in 12 months (or however long), it'd be the same price and nothing additional?

What's the catch?

ETA - we aren't planning on doing this, I'm just curious as to how it works. We are paying cash for our appliances.

Message edited 7/31/2007 4:06:38 PM.

Re: when they say "no payments, no interest" for x amount of time...

If you pay it off within the 12 months you have NO interest, you only pay what you charged... however if you don't pay it all off in that time period they accrue the interest from the beginning... so it's a great idea as long as you are SURE you're going to be able to pay it off in that time.

Re: when they say "no payments, no interest" for x amount of time...

I see. That was killing me.

I always worry when I see the "no payments" things - b/c I sometimes feel it takes advantage of people who cannot afford certain things.

I can see how this would be great if you planned to pay it off in that period of time, but not if you wait!

Re: when they say "no payments, no interest" for x amount of time...

Re: when they say "no payments, no interest" for x amount of time...

It depends on the company. With Home Depot, if you don't pay it off by the day it ends you get slammed with the interest that would have accrued the whole time. But I think we had JC Penney that didn't do that. Also our major credit cards that have been 0% don't accrue over time as long as you make the minimum payment. They just being to accrue interest when the promo period is over.

Re: when they say "no payments, no interest" for x amount of time...

Some will have you make a certain number of minimum payments- say 4 during the time period.

But if you are very good with money and can pay the full amount at the time of purchase- these plans are awesome. Your money sits in the bank earning interest for the year.

Re: when they say "no payments, no interest" for x amount of time...

I have used these offers will a lot of success. I like using their money interest free.

I make the payments to coincide with the end of the promo period.

Re: when they say "no payments, no interest" for x amount of time...

Re: when they say "no payments, no interest" for x amount of time...

Re: when they say "no payments, no interest" for x amount of time...

I have used offers like this also- Fortunoff had one when I got my couch- I paid 1/3 - then paid off the 2/3 with in 6 months

it worked out great b/c it was due right after I got my tax refund-

I would do it again for furniture or other house stuff

Re: when they say "no payments, no interest" for x amount of time...

I did this also with my furniture from Levitz (when it was Seamans).

I took the amount we owed, and divided it by the number of months we had to pay it off, but I took off 1 month. So we had 24 months, but I only did it for 23, because I didn't trust that when it came to the last month, my money would get there on time, or I was afraid the company would say, "Oh, your payment is late, you now owe us all the fees from two years."

Re: when they say "no payments, no interest" for x amount of time...

I like these offers because you use there money and earn interest on yours. I like to pay off one month ahead of time so there is no issue with timing of the last payment. YOu don't want to end up paying 20% interest from the beginning.

Re: when they say "no payments, no interest" for x amount of time...

We have used this for furniture for 14 years now and love doing it this way. We divide by how many months we have until the bill is due and save that much per month in a savings account. We have NEVER paid any interest.

Re: when they say "no payments, no interest" for x amount of time...

this is how we have our two LCD flatscreens
PC Richards coupons and 18 months no interest...love it!