Guitar Center Financing

[Spector_Ray]

Anyone ever bought anything with a Guitar Center card? There's a grand opening here in a couple of weeks and I'm seriously thinking of pulling the trigger on a very long awaited Spector Euro 4. I was wondering what the payments would be on $1500. If anyone can give me a ballpark(around the pitcher's mound) figure, I'd appreciate it.

[justateenpoet]

From their website:

Same as Cash offer on Guitar Center Preferred Player Credit Card purchases. No Finance Charges if purchase paid in full in 3 months. If purchase not paid in full or account not kept current, Finance Charges assessed from purchase date and Minimum Monthly Payments required. Variable Standard Rate APR: 21.9% as of 05/31/2006. Variable Default Rate APR: 25.4% as of 05/31/2006.

In short, if you can't come up with $500 a month, you're screwed. I'm not great with finance math, but let's do some for fun. APR is basically a percentage of your remaining balance that gets added to the original cost of the instrument. Since your bass costs $1500, let's say you want to pay them over 10 months at $150/month. Here's basically what you're looking at:

1st Month: $150 payment (no APR months 1-3)
2nd Month: $150
3rd: $150

You have $450 paid and $1050 left (aka 70% of the original cost)...now things get crazy. APR is calculated by taking the remaining total balance and multiplying by the APR rate. Your 4th month APR would be about $220. Add your required mothly payment of $150 and you've got $370.

4th month: $370

If you can afford more each month, do so. APR is a killer. If you were to use the payment plan outlined above, you would most likely be paying close to 3 times the actualy price of the bass (all because of fees).

[dannoman]

I have one, it only has a 1000.00 limit, but i would pay about 30-35 a month....

[Aarix]

I think you are confusing Annual Percentage Rate for a Monthly Percentage Rate (which is illegal in most states). I suspect in the example of a $1500 purchase with no interest for three months, you'd end up paying about $1600 total, not the exhorbatant $4500...

Here's a loan payment calculator with the breakdown by month for the remaining 7 months.
http://www.bankrate.com/brm/popcalc2...Jan+28%2C+2007

It's still not a great deal though and if you miss the minimum payments, you'll get screwed.

By comparison $200 a month is what I pay in car payments. If I couldn't save up for it outright, I'd be looking real hard at Korean/Chinese instruments before making payments like that.

[WesC]

Its APR but its not a simple interest loan, its calculated every 30 days on your remaining balance and it would be a whole lot more than just an extra hundred bucks depending on how long you took to pay it back. It could possible double the cost of the bass if you took long enough to pay it back, say by only paying the minimum.

Geez don't any of you guys have credit cards? They only ask for $20-$40 bucks a month on even a large balance... and at that rate all you are ever paying is the interest.

Revolving credit at any retail store is a very bad idea. Save up and pay cash, its the cheapest way to get what you want.

[unbasslichkeit]

Originally Posted by WesC

Revolving credit at any retail store is a very bad idea. Save up and pay cash, its the cheapest way to get what you want.

+1 on that. Credit is like a power tool - if you don't watch what you're doing it can turn on you. I opened an MF store credit for a single items I expected to pay off in three months, and I did. Kept it until I got the notice of an impending interest rate hike, then paid it off and by-bye.

[Spector_Ray]

The more I looked into it, the more of a bad feeling I got about it. I think I'll skip the financing through them. I can get a much better rate through my credit union and not have to deal with the double cycle billing and variable interest rate.

[Bryan R. Tyler]

The one thing about the GC credit card is that the GC stores VERY often will offer you 12 months no interest/no payments- sometimes longer. Nearly everything I've gotten from GC in the last three years has been under these plans. If you are good with repaying, this is a great plan- you can pay off your equipment in your own time- just makes sure everything's paid off before the 12 months runs out, or interest will accure and you'll be hit with it all at once. My GC card was my first credit card, and it helped build by credit. Don't get me wrong- it's a bad credit card- but the financing deals make it a pretty great one to use (so long as your are responsible with repayment).

[Rick_no7]

I do the same as Bryan.

I used it to build credit and I only used it with the "no interest for 12 or 15 months".

I payed it off, it was fine. Just a warning though... those cards are dangerous if you have GAS.

Sometimes I'll see an ash bodied Jazz(Valenti these days) of someone's and get a wild hair and think "I need to have one!" lol. Which is bad becaue I really don't want one.

[justateenpoet]

Originally Posted by Aarix

I think you are confusing Annual Percentage Rate for a Monthly Percentage Rate (which is illegal in most states).

Well said, I probably was.

[steve21]

I had them hold it for me. It requires you to pay 1/2 at time of purchase and then pay the rest off WHENEVER you want (They say in a month, but as long as you make at least 50 bucks per month payments they keep ti for ya).

[DGbass70]

i used it for my EURO5 and i paid it off before the 12months with another card so i paid GC 000000000 interest then the other card gave 12months and i paid the off with another card 12months no interest as well and i'm almost paid off on this new one....(play the system)

[IanStephenson]

Originally Posted by justateenpoet

From their website:

Variable Standard Rate APR: 21.9% as of 05/31/2006.
Variable Default Rate APR: 25.4% as of 05/31/2006.

Not gonna check you'r maths, but I agree - those rates are nasty.

In the UK, typical credit card rates are about 17%, and thats bad enough.
Bank Loan rates are about 8-12%
Mortgate rates are about 6%
Base Rate is about 5%

try:http://money.ninemsn.com.au/calculat...dInterest.aspx
It just told me that $1000 over 2 year from the shop would cost you $280, and from a bank around $100.

Basically if you can't wait, go to your bank and get a loan. The bank load is harder to get, but thats why it's cheaper - they check you out and make sure you're a good risk. The shop basically takes out a bank loan for the amount, charges you the payments on that plus a big wodge extra.

And remember that the low monthly payment deals are a scam too - they WANT you to pay the minumum $50 each month, as that way you take forever to pay it off, and every year they get to add another $250 to the total - five of your 12 payments go to cover the interest, so you never make a dent in the outstanding balance (Don't bother to correct my numbers, but check them yourself). They WANT you to keep paying them interest for as long as possible - take the shortest loan you can afford.

Ask them what the TOTAL repayment will be over the lifetime of the loan, and decide if you want to pay that much for the instrument.

Ian

[tplyons]

The rates suck, you're better off with a real credit card.

[srxplayer]

It's high interest rate and the interest will compund on you. It's not a great deal uness you really need a piece of gear and it's an emergency.

The no payment deal sounds good but it only works to your advantage if you have the ability to pay it off before the no payment term is up. If you wait and start making payments on your original balance they ad the compounded interest from the first year to your balalnce and then you start paying interest on the compounded interest.

IMHO Just buy what you can afford, don't get cought up in the "no payment" BS. If you have to buy on credit, there are better deals out there than the GC Credit Card.

[i like tictacs]

If you're financing a guitar, you can't afford it.

[Bryan R. Tyler]

Originally Posted by i like tictacs

If you're financing a guitar, you can't afford it.

If you're financing anything then I guess you can't afford it.

Credit, like most things, is only bad if you don't use it wisely. I have purchased much of my gear using credit cards with no issues or much, if any, interest. I get paid once a month, in addition to intermittent painting sales- last month I made nothing from paintings, this month I've made $990 thus far- paying only when I have the cash for it is not usually feasible. So I use my credit cards to buy standard stuff like food and then pay back when I get my monthly paycheck. Pay it off in time- no interest. Works out fine. The GC card is a great thing IF YOU ARE RESPONSIBLE ABOUT IT. It has the highest interest rate by far of my credit cards, but as I almost never purchase anything unless it's under the 12 month plans, the rate doesn't matter, as I always pay back in full well before the 12 months are up. In this way it's a lot better than standard credit cards- I have two with an APR of about 9%, but you don't get 12 months with no interest or fees for nearly every purchase with them. The thing I ask myself when using my GC card when there's 12 month financing is "can I pay this back withing eight months?" It allows a large margin of error as well. Again, it all depends on how responsible you are, and how well you can handle your credit. For those who can handle it, the 12 month financing is a GREAT deal.

[Bob Clayton]

if i were you, i'd get the card and wait. every so often they offer a no payments/interest for 15 months, which is how i got my new amp

[Bryan R. Tyler]

Originally Posted by Bob Clayton

if i were you, i'd get the card and wait. every so often they offer a no payments/interest for 15 months, which is how i got my new amp

I actually bought my Boss GT-6B under the 12 month plan, but there was an additional sale on Boss/Roland products at the time, so they gave me 18 months no interest/payments out ot it.