0% financing on furniture...

[ScrimpAndSave]

I am closing on my house in August and need to furnish it. I won't be purchasing anything until after I close so I can make sure that my mortgage goes through ok. There are a few items at Raymour and Flanigan that I absolutely love...and they have 0% financing for three years...or I can buy them over a period of about 6 months one item at a time cash.

I know that if you miss a payment, you owe all of the interest...but if you are really diligent, is it worth it to keep more cash available in the bank?

Thanks!

[Ima saver]

I did that when I moved into my house, bought no furniture with 0% interest. The first thing I noticed was that they added insurance to my monthly statement without me asking for it. I called and got that removed. I also made sure I paid it off a couple of months early so that NO interest could be added on at all. If you pay it off early, and WATCH your monthly statements, it is a good deal.

ps. I meant to saw bought NEW furniture , in the first line. (not no)

[Ima saver]

Which house did you finally decide on?

[ScrimpAndSave]

this one:

http://img.makeupalley.com/8/2/4/9/1318513.JPG

[Ima saver]

Congratulations. I just went back and found the thread about the new townhouse. That is great that you are getting something brand new!

[ScrimpAndSave]

Thanks for your response. My plan is to get a few very good quality pieces (couch, bed set and dining room table). The rest I can fill in from hand me downs...target...ikea. I am thinking of spending around $5,000...

[disneysteve]

You generally get a lower price, 10% or more off, if you don't do the "free" financing. It can be to your advantage to save up and buy the stuff for cash.

[Ima saver]

Disneysteve is right. I just bought a new breakfast room set for 10% off. However, if you are a careful shopper, you will do alright. I furnished my new home completely for about $7000 and that included two mattresses.
My husband built a house for a couple and they hired an interior decorator to furnish their house. They spend $250,000 to furnish, which was rediculous. (The interior decorator owned the furniture store so she made out pretty well)

[disneysteve]

Originally Posted by ScrimpAndSave

or I can buy them over a period of about 6 months one item at a time cash.

(couch, bed set and dining room table

If you can pay cash for everything you want within 6 months, I say do it. Don't finance anything, even at 0%.

[ScrimpAndSave]

Disneysteve,

I don't like the idea of having any debt at all...so this is what I will probably do. I might be able to get better deals if I pick through sales and really take my time, too.

[nmboone]

I agree with Steve, please do not go into more debt for just furniture. I know you're leaning that way anyway but just don't change your mind!

[disneysteve]

I think it comes back to what we always say. Don't finance wants. Most of us need a car and many, especially younger folks, can't get a decent one without a loan. Fine. Of course, very few people could buy a house without a loan. Fine.

You can, however, live without a brand new bedroom set. Go on Craigslist and pick up some cheap pieces to use until you save up for the set you want. When you buy the new set, sell the old stuff again, probably for the same price you paid. It is kind of like Rent-A-Center without the high costs.

[ScrimpAndSave]

Yeah and if I focus on getting the bedset first, then I won't even have to get a craiglist one. I close in August and can have all of my basic furniture needs by December...and I can stay at pops house till then!

[LivingAlmostLarge]

Depends on negotiating 10% off. I've found it's possible on small stores. But national chain stores? Best Buy, IKEA, SEARS? Not possible.

[wincrasher]

I bought alot of new furniture for my new house this last month. I found that the high end stores would only do 5% or so discount. Stuck to their guns on the delivery charge too (usually $69-$99 per order). Most of them subcontract the delivery.

The cheaper places had big sales in place already, so further discounting was not possible - but I did try. I did really well at a garden store - got a faux leather sofa and loveseat for my gameroom for $600. It may be cheap chinese, but it sure was heavy - had to carry it home myself.

I did the best on electronics by buying them on Amazon. Bought several TV sets, a message recliner and a piano. Delivered to the door without a scratch. On one TV alone I saved $700 over Best Buy's sale price.

Assembling and moving a grand piano yourself is not for the faint of heart, I can tell you that.

[FrugalIII]

I have done the 0% financing several times over the years for furniture and a bigscreen tv. But, I am disciplined enough to have it paid off before the end of the time period. If it's two years, I divide the total amount by 20 or 22 and pay that much every month. Works well for me. Lately though I've been just buying a piece at a time and paying cash. That works equally well. The stores bank on the possibility, and usually win, that the purchaser won't pay it off during that period and then get hit with a huge amount of back interest. So, to do it successfully, you have to have self-discipline!!

[boosami]

I usually take advantage of 0% financing deals on larger purchases a couple times a year. Typically, they are on revolving accounts I already have open with major stores so I don't have to apply for new credit (Dell, Best Buy, Sears, Tiffany's, etc.). I have never been screwed over on it, but I am very careful to understand all the terms, not miss payments, and pay it off before the promotion ends.

As others have mentioned, sometimes prices will be inflated for people who do "free" financing. From the other 0% financing thread I mentioned:

Whenever I do 0% financing deals for purchases, I make sure I would get the same price if I were to pay cash on the spot. Usually, I act like I am going to pay cash, find out the price, and then inquire about any 0% deals. If they will give me 10% off up front for cash, that is a better rate of return than investing my cash in a CD or pretty much any vehicle!