I have taken advantage of 0% financing.  (So I didn't have to take money out of savings.)

I would be concerned about the fact that you got in over your head once, so I would probably pay the 6k off and then get the furniture (however you decide to finance).  4 months isn't that long.  I have currently have some empty rooms because I want really nice stuff so I am waiting and doing it one room at a time.  It isn't that bad.

If you take on more debt your score could drop some.  Especially depending on the credit borrowed versus the limit they give you.

The biggest downfall with 0% offers on furniture is that you lose the negotiation power that you get with cash. Since they're not charging interest up front, they charge more for the furniture and you can't negotiate.

 

It is not wise because:

1) you are borrowing money to pay for something that is rapidly losing value (ie not an "asset").

2) You are counting on having more money now than later--if you or DH lose a job do you want to worry about paying for furniture on top of food, mortgage, heat, etc.? Furniture that is paid off could be sold in times of crisis but that won't help if you owe more than you could sell it for.

3) Its never really "0% same as cash". Offer cash---they will give you a discount. Also often the fine print says that if you don't pay it off on time there is pretty high interest.

 I would check out craigslist and buy something that you can afford now instead of borrowing from the future. 

We bought our dining room set from havertys. We took out the card to do the 0% and paid it. The only possible problems were that they tried to give us a ridiculously high limit (10x the amount of the purchase). This could be good way to raise your credit to debt ratio but its also a good way to get in credit trouble if youre prone to that.

FWIW they did not offer us a discount to pay with cash, which was our intention but we never asked. I didnt know you could negotiate at a real store?

3) Its never really "0% same as cash". Offer cash---they will give you a discount. Also often the fine print says that if you don't pay it off on time there is pretty high interest.

Maybe furniture is different than appliances, but I really only paid the purchase amount.  No interest.  They will charge back interest if you fail to pay it off in time.  And there is always room for negotiation, but I used coupons and unless I went to a scratch 'n dent, the price wasn't going any cheaper.  I bet a couch or something could be different.

mmeogrossi:

FWIW they did not offer us a discount to pay with cash, which was our intention but we never asked. I didnt know you could negotiate at a real store?

Yep. They're not going to offer; you have to ask. Rooms To Go is the only furniture store I've been in where they wouldn't negotiate for cash.

Kore!:

The biggest downfall with 0% offers on furniture is that you lose the negotiation power that you get with cash. Since they're not charging interest up front, they charge more for the furniture and you can't negotiate.

 

ITA.  I bargain on furniture and mattresses like they are used cars.   And when they try to "negotiate" by offering financing options I just laugh and say I don't need financing.  I always get great deals that way. 

mmeogrossi:

FWIW they did not offer us a discount to pay with cash, which was our intention but we never asked. I didnt know you could negotiate at a real store?

I don't think it is ever a store policy or something they offer formally.  My parents have gone in stores and offered less with cash and had them accept it.  It is always worth a shot, if you have the cash.

where do you start? 5% off? 10%? im not good at that stuff at all. it just seems so much easier to finance than to transfer funds and that jazz. i know thats extremely lazy mm but it just isnt a problem. i hate buying a car. when i bought my last one i desperatly wanted to go to carmax but fi negotiated the price at a lot for me. i cant even haggle in countries when its expected. it just feels fussy to me.

mmeogrossi:

where do you start? 5% off? 10%? im not good at that stuff at all. it just seems so much easier to finance than to transfer funds and that jazz. i know thats extremely lazy mm but it just isnt a problem. i hate buying a car. when i bought my last one i desperatly wanted to go to carmax but fi negotiated the price at a lot for me. i cant even haggle in countries when its expected. it just feels fussy to me.

I hate negotiating, too, but it's worth it. You can start by saying, "What's the best price you can give me for cash today?" I've also heard of people negotiating free delivery, adding an extra piece to a set, etc.

At 3 stores that I went to for our bedroom furniture, cash didn't get me a lower price. I tried.  I said I could pay with a check for the full amount if they would take off 10% of the price and they laughed.  I said I'd be game for 5%.  They said they couldn't do that.  Two of the stores were Linders and Discount Furniture.  Perhaps higher or even lower end stores are different. 

Since they didn't give me any perks for paying up front, I said fine I'll take 0% financing.  My limit was 16k, and they definitely tried to sell me on more furniture.

I think if you're careful about paying off that 6k in 4 months like you intend, and are fairly certain you and DH will be in a good financial position where you won't need that "furniture money" anytime soon, go for it.

Sorry but I'd never pay up front in cash when the store is offering 0% interest financing as long as I'm financially secure on all other bases.  That's just me. 

We tried to get Nebraska Furniture Mart to go down in price on our bedroom furniture.  No dice.  We ended up using the "friends and family" discount as a HS friend of ours works there.  So we got 15% off and did 3 years 0% financing. But our set was a little over $1000 after the discount.  So it wasn't a "major" purchase.

This is all really good advice! It seems like the main advantage of paying in cash is being able to negotiate, but like PP said, we tried that at Broyhill, and we only got our sales tax paid for, which was still nice though.

I am not worried about me and DH losing jobs, as we have very stable positions. And I also am not worried that we would get in over our head (like we have before). Credit cards were my college days, and we are A LOT smarter now.

Ok, well I'm still going to think about it. I've always heard financing was a big no-no. But with no interest, it just seemed like such a good deal. And I was wondering if there was a 'catch.'

You're $6k in credit card debt and want to go another $3k+ in debt for FURNITURE?

No no no no NO.

Denied.

Pay off your debt, build an efund if you don't have one (if you do, I'd consider putting some of that toward your debt) and then consider the furniture. If you've had CC debt in the past, you're probably better off saving and paying in cash.

 

cjeanette:

We tried to get Nebraska Furniture Mart to go down in price on our bedroom furniture.  No dice.  We ended up using the "friends and family" discount as a HS friend of ours works there.  So we got 15% off and did 3 years 0% financing. But our set was a little over $1000 after the discount.  So it wasn't a "major" purchase.

Wow - you did good. I live in Omaha - the NFM here would not allow me to use 0% & Friends and Family. Nice work. My BIL now works there so I get immediate family - it saves a lot. Its crazy the mark up.

I say if you have your cc debt paid off, or as you mentioned will in 4 months go for it - dont drag out the payments though.
 

I would only do this if I already had the cash to pay for the furniutre.  But w/ 6k in credit card debt, you should pay off that debt first before you get in more debt.

I would wait.  Pay off the cc first.  Since you are making $1500/mo payments (I presume) to the cc, after it's paid, I'd make a few $1500/mo payments to your e-fund, until it is built up, then buy the furniture.  Most furniture stores offer 0% financing periodically, so this certainly isn't your last chance. 

while i am one of those who wouldn't pay with cash if there was 0% financing available (we've done this several times), i would recommend you NOT go this route since you already have significant credit card debt. we've only done this in the past b/c we knew we had the money already in savings and simply used the 0% financing to keep the majority of it there over the course of paying off for the year or two.  but if you can't have a reasonable guarantee that you might not be able to pay it off, then i wouldn't. the interest they add on at the end of the 0% period is horrendous.

You should pass. For one, you already have consumer debt on your CCs (though you'd get a bit of a pass if your CC debt was from medical bills or something else non-consumery). You need to totally get out of that and into living within your means before taking on more consumer debt. And frankly, I would pass then, too. Instead, just save up the money beforehand.

Also, Havertys is wayyyy overpriced IMO and you are basing this off of a min. of $3k. Do you really need $3k worth of furniture or is the "deal" encouraging you spend more than you would? Honestly, the fine print of the store when we bought our furniture was that "cash" (just not financing with them- we paid with a CC that we pay off every month) got us 10% off. Suddenly 0% wasn't so free.

If you miss one payment you'll get socked with late fees and a higher interest rate. For $3k, an amount that is attainable with a few months of saving, I'd just wait until you can pay for it outright and leave the CC lifestyle totally behind you.

jenny1980:

You're $6k in credit card debt and want to go another $3k+ in debt for FURNITURE?

No no no no NO.

Denied.

Pay off your debt, build an efund if you don't have one (if you do, I'd consider putting some of that toward your debt) and then consider the furniture. If you've had CC debt in the past, you're probably better off saving and paying in cash.

 

Ditto.  And do you even NEED $3k worth of furniture, or are you just shooting for that to qualify for the financing deal?

I would not do it. If we do not have the money to pay for it now, we do not buy it. Especially if I had CC debt. I would not be buying anything that was not absolutely necessary until that was paid off. We also pay for our cars in cash, so we avoid debt. The only debt we have is SL debt at the moment.

While you have cc debt, do not add to your debt load.

In general I am a believer of saving first, then buying.  There will always be sales.  You need to be careful with the 0% financing for if you do not pay in full by the date, they will charge a high rate of interest retroactively.