Quote:
Originally Posted by Iron Chef
I think people might be missing the point of my thread: By offering these terms which were previously unheard of, are they not encouraging people to spend money they don't really have?
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I doubt it.
1. There is is nothing inherently wrong with using someone else's money for 5 years, free of charge. The very smart people often take advantage of that even if they don't need to, that is, "all else equal" (to address Phil's point about retail price differences to cover it).
2. You have to qualify for that loan.
As you might know, lenders have radically tightened up their approval requirements, so it could be said that if you can't afford it, you won't be realizing those terms, because you'll never qualify for that loan to begin with. Ad hype brings people into the store, that doesn't mean a guaranteed done-deal with the bank.
3. Everyone is trying to find a way to get consumers buying again. It IS what drives our economy. Most reading this may have never stopped buying goods, but that's not an accurate portrayal of the country as a whole either.
Not everyone has $1500 in cash to drop on a new mattress set, (and if they did, would it be their priority as to how to spend it?) but the vast majority could swing a $20 monthly payment. Sure, the tactic entices people (who otherwise wouldn't) to buy, but claiming affordability is a totally different thing. The lender will have to determine that to their satisfaction prior to financing them.
Since you didn't post all the tiny print details about this 5 year no interest deal, these are the conclusions I arrive at.
