First case, my wife recently had to have major dental work done resulting in her upper teeth being extracted and a denture made. The cost was nearly $4,000. The finance person in the dental clinic office said “Not to worry, we have an interest free financing plan as long as you pay the bill within eighteen months. Two weeks later we received a monthly bill for $123.00 and a schedule showing how the bill would be paid off in three years paying $123.00. The bill did not mention that after eighteen months if the bill was not paid in its entirety 29% interest is charged from the initial date of the debt. My wife and I put a pen to the situation and determined that after the three payments for $123.00 we had made that we needed to be making payments of $280 a month to avoid having to pay 29% on the original $4,000 debt. So, we had to enter $280 for dental care into our budget rather than $123 for dental care. When they explain is is an interest free financing plan that is totally inaccurate. Right on the statement you receive, it says no interest is charged if you pay this bill in its entirety. Why would a person be paying over time if they had the money to pay the bill in the first place? Synchrony is the primary financing company that many doctors use to get their money right away, The patient had better beware!

Second case, we purchased a used bed and mattress for our guest room, we did not know that the slats fell through if you were not careful getting on the bed. We had friends that were coming to stay with us while their new home was being constructed, we needed a decent bed for them right away. We decided to put our queen size bed, that was comfortable, in the guest room and to look for a new bed and mattress for our bedroom. We went to a major mattress company here in Casa Grande, Arizona and tried about every mattress they had. They had a $3,800 mattress and bed with a lift system on sale for $2,000 since they were closing out that model. It is a great mattress. My wife likes making the foot and head of the bed bow up at an angle while she reads. We purchased a few other items from the mattress company. The woman salesperson said we offer no interest financing for up to three years. It took a very long time while she entered all of the information into their system. They were to deliver the mattress in two days which was the day our friends were coming. They did deliver the mattress at the scheduled time and we were good for our guests. We moved our bed and the night stands into the guest room. A month later the bill comes from Synchrony Bank for $84.00. It also says no interest if paid in full. We thought we had thirty six months to pay for the bed. After discovering the problem with the medical financing with Synchrony Bank , we decided to check on the financing for the bed. It too was for eighteen months when we checked the information on the billing statement. After eighteen months they charge 29% interest on the full amount of the debt. So, my wife and I computed what has to be paid after we had paid six payments to get this debt paid within the eighteen month time limit. Now our budget has $180 a month instead of $84 for the mattress.

Third caseOur only car was a 2008 Hyundai Santa Fe, it had 161,000 miles on it. We had recently had to spend $700 for a new starter replacement and towing. I was looking for another used Hyundai Santa Fe with lower mileage at a reasonable price. I looked on Carguros every day for Santa Fe’s 2008 to 2015. Several of the ones listed looked like good deals but they sold before I had a chance to look at them. About three months ago I saw a 2009 Hyundai Santa Fe 3.3 engine, one owner, no accidents, sun roof, new tires, like new condition with 64,000 miles on it listed at Dale Earnhardt Toyota in Mesa, Arizona. I called and inquired about the car , they had just received it when the couple purchased a new Toyota. We made an appointment and went this huge Toyota dealership. They had a four level parking garage just for the cars not on the lot. The salesman said they sell over one hundred cars a week. When we got there the salesman had brought the car to the staging area outside the showroom. The salesman accompanied us for the test ride. My wife did the driving. She took it on the 202 freeway and around the business area near the dealership. Our 2008 Hyundai Santa Fe had a 2.7 V-6 engine, this car had a 3.3 V-6 engine, the additional power was very noticeable. She loved the car. We went through the traditional negotiation phase and traded our car and $1,000 cash and financed the balance. The going interest rate on a used car, we were told, was 7 3/4% and we would need to be approved by the finance manager. The finance manager ran a credit report and said, “Ok, now since this is a used car and the 100,000 guarantee by Hyundai is not transferable, you need this repair contract and before you say ‘No’ , I will reduce your interest rate to 5 3/4 % so the interest difference will pay for the repair contract. That way the repair contract has cost you nothing. We agreed to that , but I could see that the interest reduction did not completely pay for the repair contract but I thought it was a good idea to have the repair contract. When the financing was complete with Chase Bank, we had payments of $287 a month for three years at 5 3/4 %. I had made three payments and got a call from the Financing Manager at Earnhardt, he disclosed that Toyota would not allow him to sell a repair contract on that car since the car is a 2009 and this is 2019. He said Toyota said the car is ten years old and not eligible. The result was that Earnhardt refunded $1750 to me by crediting the loan account. Certainly if I had known that the repair contract cost $1750 I would not have agreed to it. Any way we are happy campers, we will have the car paid off ten months earlier.

Read the fine print, mathematically compute how much it takes to pay off a time purchase, and compare to what the doctor or salesperson tells you. Synchrony Bank has hundreds of businesses that do financing for and virtually all of financing is for eighteen months , but the bills the person receives will not pay the debt off and they will end up paying 29% on the initial balance if they do not accelerate the payments.