Furniture can be expensive. As a result, a lot of people look into obtaining furniture credit lines. This will enable them to spread the cost of their furniture over several payments. How do you know if a furniture credit line is right for you, though? Hopefully, this information will help.
Can you pay for the furniture outright?
Generally speaking, if you can pay for the furniture outright, then do so. While you may be taking a short term hit on your finances, you will often be saving hundreds of dollars in the long term.
Obviously, only go down this route if you can absolutely afford not to have access to this money for a short amount of time.
Do you have a credit card?
If you have a credit card, then you may actually find it is worth your while to put the furniture on your credit card instead. In most cases, the furniture credit line will cost you a lot more than the interest rate on your credit card. Once again, this means that you will be able to save money.
Do you have bad credit?
While there are furniture credit line options available to those with poor credit, you should probably remember that they will be far more expensive for you.
In many cases, if you do not actually need the furniture right now, it may be worth spending a few months improving your credit score. Even a small improvement in your credit rating can often see huge savings when it comes to the interest on the credit line.
In some cases, you may actually want to research the other types of loan that you have available to you. For example, bad credit loans may offer a better interest rate than a furniture credit line.
Remember, if you are buying furniture from a store, they may turn you down if you do not have a decent credit score. However, this doesn’t mean that there won’t be other options out there that you can make use of. There are. Just make sure that you really, really do need that furniture beforehand!
Can you meet the monthly repayments?
If your finances are pushed to the absolute maximum, then you shouldn’t even be considering the idea of a furniture credit line..
Now, most lenders will ask you about your income before they lend to you. However, this will be the extent of their questioning. They probably won’t ask if you are able to afford it.
If you miss the monthly repayments, then you are opening yourself up to all sorts of issues. This means hits on your credit score. Massive late payment charges. It will cause far more hassle than it is worth, and your financial life could suffer for years and years to come.
So, whenever you apply for credit, you need to know that you are going to be able to afford it. If you can’t guarantee that you can afford your furniture line of credit without having a bit of leeway built into your budget, then it is not right for you.
We know that it can be tempting to apply for a line of credit when you are purchasing furniture. However, you really do have to remember that it is not going to be for everybody. In many cases, it is going to be cheaper to buy outright, or leave it a few months while you build up your credit score. Only use a furniture credit line if you really have no other choice but to use one.