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Comparing_The_Home_Depot_Credit_Card

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					Comparing The Home Depot Credit Card

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472

Summary:
The Home Depot credit card, like all store branded credit cards, offers
consumers some very enticing benefits. For example, the Home Depot card
often advertises specials such as a 0% interest rate and no payments for
6 months. However, there are a number of factors to consider when
applying for a credit card. Perhaps the most important factor is the
interest rate. And the Home Depot credit card scores quite poorly here.

If you a take a look at the online application for t...


Keywords:
home depot credit card, home improvement, credit cards, personal finance,
advice, interest rates


Article Body:
The Home Depot credit card, like all store branded credit cards, offers
consumers some very enticing benefits. For example, the Home Depot card
often advertises specials such as a 0% interest rate and no payments for
6 months. However, there are a number of factors to consider when
applying for a credit card. Perhaps the most important factor is the
interest rate. And the Home Depot credit card scores quite poorly here.

If you a take a look at the online application for the Home Depot credit
card, you may have a hard time finding the interest rate. And, when the
card is presented to you at the store, cashiers generally don’t attempt
to influence your decision by mentioning this essential credit card
element. However, the truth of the matter is quite disturbing. Like most
other store credit cards, the Home Depot credit card charges an interest
rate that is forty to over one hundred percent higher than standard
credit cards! And that’s for consumers with good credit.

Credit cards issued by most major credit companies presently offer two
things the Home Depot card does not: low long term interest rates and 0%
interest on purchases and balance transfers for 1 year. For a large
purchase that will be paid off over a period of time, the best credit
card is a new credit card that offers 0% interest on purchases for 1
year. Why? Let’s buy new carpeting for $2000 and figure out the
difference.

Many credit cards offer interest rates around 11% and 0% introductory
rates for up to 1 year. Using such a card would cost us 0% in interest on
our $2000 purchase during the first year, and, assuming we’ve paid off
$100 per month, total interest charges would total about $65. Total cost
of the new rugs: around $2065.
The same purchase using a Home Depot card with an average interest rate
of 22% and the same payment schedule would cost us $143 during the first
year and close to $100 the second year. In other words, about $200 more.
This assumes that we do not take advantage of the no payments for six
months. Factor that in and we pay an additional $150, bringing our total
interest cost to $350. That means our $2000 rugs actually cost $2350!

In this author’s estimation, the most important element of a credit card
is the interest rate. After all, if purchases are not paid off in full
each month, the items we buy end up costing a lot more than they did at
checkout. The best credit card for new purchases, especially large ones,
should be the one with the lowest interest rate and the best 0%
introductory rate. The same holds true if you are stuck with a balance on
a high interest store credit card. Simply transfer the balance to a 0%
APR balance transfer credit card with a lower interest rate. The savings
add up. Quickly!

				
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