Why would you charge something on CC you couldn't pay off in 1 month?

[Dopey Sharon]

Originally posted by disneysteve
I'm curious. When you paid for DVC with CC, was there any added fee? Since the company has to pay the CC processing fee of 2 or 3%, it would seem they wouldn't want to accept a CC payment because it would cost them money.

No, I wasn't charged anything more.

 

[arminnie]

Originally posted by disneysteve
I'm curious. When you paid for DVC with CC, was there any added fee? Since the company has to pay the CC processing fee of 2 or 3%, it would seem they wouldn't want to accept a CC payment because it would cost them money.

No added fee at all. It is against Visa and MC rules and regulations for a merchant to charge a premium for accepting a CC. I know it's splitting hairs, but a merchant can offer a discount for not using a CC. (fyi Merchant have been know to break rules)

Yes it would be nice to get points for buying a car, but since there is so much negotiation in the process I'm sure that they would just give you less of a discount off the sticker price if they did take a CC.

Back to Disney:

Disney has a merchant acceptance agreement with a bank. The bank is paying somewhere just over 1% for the CC fee (MC and Visa wholesale rate). It is totally up to the bank what their agreement with Disney is - if they are a big enough customer they might pay just a little bit more than the wholesale rate. That bank takes the whole banking relationship into account when setting fees.

If their merchant bank is Bank One they may have gotten a real deal on the acceptance (merchant) side of fees in exchange for being chosen to issue the Disney Visa Card.

I'm not sure about this but I think I was told that only MC and Visa could be used to purchase points but AMEX could also be used to pay dues.

 

[disneysteve]

Originally posted by arminnie
Yes it would be nice to get points for buying a car, but since there is so much negotiation in the process I'm sure that they would just give you less of a discount off the sticker price if they did take a CC.

Only if they knew I was going to pay by CC before they negotiated the price. Obviously, I wouldn't tell them that up front. Same reason I don't tell them if I have a trade-in or how I plan to finance the car before I negotiate the price.

Oh well, maybe one of these days they'll start taking CC's. Great that folks could do it with DVC, though.

 

[dcfromva]

The last two times we bought a car I asked to pay with a CC and was not allowed either time. I wish the car dealers would start accepting credit cards. We could rack up plenty of reward points that way.

Disneysteve,
When I purchased my car 6 years ago, I used a CC for part of it. I had been looking for a particular car with particular features.
I called up several dealerships and when I found the car/deal I wanted, I had them hold my car with a deposit on my CC. I had saved for the down payment, so I thought I might as well get reward points for it.

The dealership did say that $5,000 was the maximum they would put on the CC, though.

-DC

 

[disneysteve]

Originally posted by dcfromva
Disneysteve,
When I purchased my car 6 years ago, I used a CC for part of it. The dealership did say that $5,000 was the maximum they would put on the CC, though.

-DC :ears:

Thanks. I'll give that a try next time. We won't be in the market for a few more years though. Have to get the reward points elsewhere for now.

 

[FredS]

Originally posted by heathrow42
....... I can't understand charging something you couldn't pay for at the end of the month, unless it were a real emergency and either you had no savings, or you couldn't get to it. (ie. water heater, refrigerator broke, need car repaired to get to work etc.)

I just don't understand.. if something really awful happened, like you lose your job, you have no savings left, and your car breaks down. You're going to have trouble paying your credit card bill.. for something like DVC, which is a want rather then a need. I know this is thinking negatively.. but you just don't know what is going to happen.

.... Oh well, I guess it's all the years of my MIL saying column A, and column B. Column A is all the things that are needs, food, shelter etc. Column B is all the things that aren't needs, and there you have to choose what's important and what's worth it.. I guess people get confused.. you may need a car to get to work, but you don't *need* a new $40k truck.

--heather

There is a HUGE difference in someone on tv who spends far beyond their means and someone who might occasionally finance a purchase. Since you mention a MIL I assume you are married. Did you and your husband pay cash for your home? I am sorry, but I would prefer that my family enjoy a nice home now, rather than wait until we can afford to pay the total in cash. I also assume that you never finance an automobile. I paid for my first car in cash and it was the a black hole of money -- I learned quickly that it would be a wiser financial move in the long run to buy a nicer, more dependable car even if I needed to finance part of it. That is what I have done, paying at least half down then financing the rest at a good rate.

A couple of years ago my family began camping and enjoying it. We began to seriously look at a $12,000 travel trailer. We did not want to deplete out savings to purchase it outright, but also were looking at a WDW stay at a resort which would cost us about $2,000 for accommodations. We chose to finance half of the cost of the trailer, and stay in it at Fort Wilderness and save the resort costs. I guess we could have put off the purchase for several months until we could pay cash, but fiscally it makes much more sense to spend $150 on finance charges and save ten times that on an imminent expense.

Also, you may not be aware that there are such things as job, disability and life insurance. We are very fortunate to have good jobs that are secure. However, we have insurance to cover us if we lose our jobs, are disabled or die. It is foolish to not have insurance to cover your living costs if something should happen to your job. It sounds like you are not aware of these types of insurance and presumably don't have them. Paying off a credit card bill might be the least of your worries if you have no insurance but cannot work -- how do you plan to pay for your basic living expenses?

As already mentioned, to each his own and sometimes we should pay a little more attention to ourselves before venturing out to criticize others.

 

[Sandyincanada]

Oh well, I guess it's all the years of my MIL saying column A, and column B. Column A is all the things that are needs, food, shelter etc. Column B is all the things that aren't needs, and there you have to choose what's important and what's worth it.. I guess people get confused.. you may need a car to get to work, but you don't *need* a new $40k truck.

Well, I know that I am not "confused". I may not *need* that $40k truck but DH and I are fulltime professionals with very secure but high stressed jobs so need is not the word for us, we feel that we *deserve* that 40K truck. And everytime I jump into it, it makes me feel good and takes away abit of that stress.

Heather, everyone is in a different financial and age situation in their lives. If money is tight or your not secure, then yes, CC's can be a problem. We are finally in the position that if we want that big screen TV now and its on a good sale, we throw it on our low interest CC. We have no real worries that we can't pay it off and a good sale makes up for the interest. We don't go silly with it and like Fred mentioned, we also have insurnace.

If I read your comment 15 years ago, I many have somewhat agreed with you

 

[FINFAN]

All I have to say is "Live and let live". These kinds of posts drive me nuts. There is no absolute correct way to live life, nor can you predict the future. Why do people care how anyone else purchases or finances items in their lives? I often have to deal with lifes expenses BOTH ways...in cash and with credit. Life goes on.

 

[Tiffany]

Originally posted by SandrainNC
I just want to know what credit cards are available with those great rates (4.5% and under)???

Thanks ahead of time for the info!!

Sandra

It depends on your credit rating but 0% to 4.9% offers I get in the mail all of the time and the cards that we have balances on are at 0% so it is an interest free loan. We plan to have the balance(s) paid off before the 0% is up. One of the cards is 0% for the life of the amount we transfer as long as we use the card twice a month. So we buy gas with it.

Believe it or not sometime debt is not a bad thing. As long as you have the means to pay it off.

 

[DiznEeyore]

Originally posted by FINFAN
All I have to say is "Live and let live". These kinds of posts drive me nuts. There is no absolute correct way to live life, nor can you predict the future. Why do people care how anyone else purchases or finances items in their lives? I often have to deal with lifes expenses BOTH ways...in cash and with credit. Life goes on.

 

[lc1965]

I have very mixed feelings about this post as well. Yes, it sounds like theoriginal person is soapboxing a bit, being a bit judgmental. However, it is a valid question from someone who clearly has never experienced debt. The question is one that has perplexed me, as well, though. I have recently faced a situation where different views of finances have come into play. To wit...

My ex-boyfriend has enormous debt & takes it as a matter of course. I pay my credit card in full every month & do whatever I have to do to do that, if it means not eating for a day or 2 ... well that might be an exaggeration, but I know what my budget is & I stop spending when I'm out of money. In HIS case, he has always been in debt, his family has always been in debt, & it never occurred to any of them that it is extremely expensive to buy a $12 lunch on a credit card that will eventually cost $50 or more. Just not an issue. Charges are charges & fees are fees & the 2 are not related... to them

Just yesterday he was FURIOUS because his bank refused to take off a charge from his debit/charge card that he never made. I agree that they should have. After all, he never made the charge. But, his bank did not care about his threat to close his account because he never pays his bills on time, is always overdrawn, & they have waived fees repeatedly. He's not a valued customer because he's a pain in the neck.

I think people SHOULD pay their bills in a reasonably timely fashion &, when they don't, fees & percentages, etc, go up for those of us who do as well. There are people who legitimately NEED to carry a balance for a month or 2. That is the way the finance system works. I will continue to pay my balance in full until I simply have no choice. But, my line for not crossing until true emergencies is STILL going to be tremendously different from others'.

 

[goin2disneyagain]

Not everyone can pay off their credit cards at the end of the month. If they could then credit card companies would change the policies and the entire balance would be due at the end of the month and there wouldn't be a finance charge for carry-over balances. It's not realistic to think that everyone can do that. It would be nice if we all lived in a debt-free society but it just isn't realistic.

 

[lc1965]

it is a more realistic option than some people w/ revolving debt realize. I don't know your personal circumstances, goin2disney, & it doesn't matter because I'm not referring to you specifically. I'm just saying that some people keep a revolving credit because they don't see why they shouldn't, as opposed to: they have no choice in order to feed the kids & keep a roof over their heads. For myself, I'd rather stop spending on things I can & work a 2nd job, etc, than keep a revolving debt. Some months I just make it & some months I can put away for one of those crunch months. I have a WDW trip & a semi-annual car insurance payment due in Nov -- don't know how I'll manage, but it's going to be a crunch month. I won't revolve the debt, though, because that is unacceptable to me. And some people don't see that POV at all.

 

[MrsPete]

I agree with the original poster's assessment: For the vast majority of us, it doesn't make sense to carry revolving credit card debt.

Why is it anyone else's business? Simple: Way too many people are doing this -- they're living too close to the financial edge, in fact, many people are living over the financial edge and they owe way more than they'll ever be able to pay. Some of those irresponsible people end up declaring bankruptcy, which hurts our economy and each of us in the long run.

Of course, most of us must finance some necessities: a home, cars . . . but that's not where most Americans are racking up debt. For most people, it's meals out, clothing, toys, etc. that adds up the credit card bills.

Personally, I think it's a bad idea to finance luxuries such as DVC. Save a couple years and buy it outright. If that sounds un-doable, then why would you think you can pay for it over the course of a couple years via credit card? The credit card option will cost considerably more than saving for it.

 

[goin2disneyagain]

Originally posted by lc1965
it is a more realistic option than some people w/ revolving debt realize. I don't know your personal circumstances, goin2disney, & it doesn't matter because I'm not referring to you specifically. I'm just saying that some people keep a revolving credit because they don't see why they shouldn't, as opposed to: they have no choice in order to feed the kids & keep a roof over their heads. For myself, I'd rather stop spending on things I can & work a 2nd job, etc, than keep a revolving debt. Some months I just make it & some months I can put away for one of those crunch months. I have a WDW trip & a semi-annual car insurance payment due in Nov -- don't know how I'll manage, but it's going to be a crunch month. I won't revolve the debt, though, because that is unacceptable to me. And some people don't see that POV at all.

I wasn't referring to myself. I almost always pay off my credit cards at the end of the month but I am one of the few and I know that. Most people I know carry a balance and are in debt to some degree. I just know that it is not realistic to think that everyone can do this. I have a friend that is in major debt and can't understand how people can take several nice trips a year and have lots of nice things. I always tell her that not everyone is in debt (the flipside of what I posted previously) like she is. Not real sure why you decided to single me out but since you did I had to defend myself. Maybe what I said made you really think about it. I do agree that some people let it get WAY out of hand but not everyone.

 

[FredS]

Originally posted by MrsPete
I agree with the original poster's assessment: For the vast majority of us, it doesn't make sense to carry revolving credit card debt.

Why is it anyone else's business? Simple: Way too many people are doing this -- they're living too close to the financial edge, in fact, many people are living over the financial edge and they owe way more than they'll ever be able to pay. Some of those irresponsible people end up declaring bankruptcy, which hurts our economy and each of us in the long run.

Of course, most of us must finance some necessities: a home, cars . . . but that's not where most Americans are racking up debt. For most people, it's meals out, clothing, toys, etc. that adds up the credit card bills.

Personally, I think it's a bad idea to finance luxuries such as DVC. Save a couple years and buy it outright. If that sounds un-doable, then why would you think you can pay for it over the course of a couple years via credit card? The credit card option will cost considerably more than saving for it.

Um, excuse me??!! Because some people declare bankruptcy you HONESTLY think if someone does not pay off their credit card bill each and every month that it is your business? Puhleeze! No, it is not. You handle your finances your way and I handle mine my way, thank you very much.

 

[janette]

I purchased DVC in 2000 & 2001, one of the contracts I've transferred to a CC at 3.9%. The other is paid off. As far as waiting until I had the money saved that doesnt' work in this case. Right now the price of DVC is $95 a point, I paid $65 a point. I've had almost 4 years of use and could probably make a profit if I wanted to sell. Credit doesn't always mean you pay more, even with interest I've spent less than I would now.

I agree with those that say everyone handles money different, don't really care about their business.

 

[lc1965]

goin2disneyagain -- please let me clarify -- i was not singling you out. in fact, i was trying to be careful NOT to. i incorrectly drew the conclusion from your post that you probably carried a balance. i know some people who legitimately carry a balance too, out of necessity. but for every one of them, i know 3 or 4 who revolve debt because they don't understand why they shouldn't. that's all i meant.

 

[disneysteve]

Originally posted by FINFAN
Why do people care how anyone else purchases or finances items in their lives?

I'm not the OP but I'd like to answer this if I may.

I do not mean to judge or criticize anyone who handles their money differently than I do. But I am genuinely curious what goes through someone's head when they say, "Boy, that's a nice *whatever*. I'm going to buy it with my credit card even though I know I don't have any money to pay the bill when it comes." I just can't imagine ever doing that.

Also, as someone else pointed out, how other people handle their money affects all of us. It affects the prices we pay, it affects the interest rates we get, etc.

 

[FredS]

Originally posted by disneysteve
I'm not the OP but I'd like to answer this if I may.

I do not mean to judge or criticize anyone who handles their money differently than I do. But I am genuinely curious what goes through someone's head when they say, "Boy, that's a nice *whatever*. I'm going to buy it with my credit card even though I know I don't have any money to pay the bill when it comes." I just can't imagine ever doing that.

Also, as someone else pointed out, how other people handle their money affects all of us. It affects the prices we pay, it affects the interest rates we get, etc.

What? Are you saying that every person who ever finances something is consciously aware that they aren't going to be able to pay for it?? Or have you wandered so far from the original topic of why someone would ever not pay off a credit card bill in full each month?

And since YOUR finances affect US ALL so much then are we all supposed to let whomever so desires question us and see all of our financial info? How much do you make? What have you financed in your life? What was the interest rate? Apparently I need to take much more interest in other people's financial affairs than I have been.

Who decides what part of MY business is YOURS? (And I fail to see how my paying interest or not paying interest affects you to any real degree.)

I would guess, based on some general income figures as well as just looking around my world, that my family is financially better off than the majority of Americans. However, I would never imagine saying that I have any entitlement to question the financial decisions of others who are much lower on the income scale, or who are financially worse off. But it sounds as if you believe that you get to criticize everyone who lives below the poverty level because clearly they are inferior to us and their obvious financial mismanagement might affect us. That would seem to be the next step in this thought process..............