There’s also something called a “line of credit” which is basically a credit card with lower interest and no cash advance fee, but no rewards.
Obviously you don’t want to keep a balance on that either, but if you can’t fully pay off your credit card, you can at least save money by transferring the debt there.
My thinking is that it’s a way to avoid adding to existing credit card debt, and accumulate more net “interest free debt” so to speak, as it’s a separate pool from a credit card.
Yes, I know. But if one is going to have the debt one way or the other, I kinda see the logic.
From what I’ve found reading terms on some of these it’s fees baked into them that are pretty dang steep compared to interest if you pay them off immediately. Many then balloon once you get past some arbitrary point between 30-90 days. Might take a look at this to get an idea. I’ve seen these guys recently at a mattress store and googled a cost estimator to see how they worked.
I never considered this. That makes them seem more reasonable TBH, though of course they screw you over more if you pay late or pile them up.
Credit cards also don’t charge interest if you pay off the balance every month.
There’s also something called a “line of credit” which is basically a credit card with lower interest and no cash advance fee, but no rewards.
Obviously you don’t want to keep a balance on that either, but if you can’t fully pay off your credit card, you can at least save money by transferring the debt there.
The way credit should be. All rewards do is take money from others on the end by having higher intrest to pay for all those rewards.
My thinking is that it’s a way to avoid adding to existing credit card debt, and accumulate more net “interest free debt” so to speak, as it’s a separate pool from a credit card.
Yes, I know. But if one is going to have the debt one way or the other, I kinda see the logic.
Do these loans report to the credit bureaus?
The loaner must be getting something out of the exchange. If it’s not interest, then it’s collateral.
From what I’ve found reading terms on some of these it’s fees baked into them that are pretty dang steep compared to interest if you pay them off immediately. Many then balloon once you get past some arbitrary point between 30-90 days. Might take a look at this to get an idea. I’ve seen these guys recently at a mattress store and googled a cost estimator to see how they worked.