Taking your car into the shop is always a nightmare. How often have you gone in for some simple maintenance, only to be pressured by the mechanic that you urgently need this and that done? For me, it happens every time. More than once I have even caught the mechanic out right lying to me … I may look naive, but little do they know that I grew up two thousand miles away in Detroit, working on cars as a kid.
If you’re getting work done on your car and are thinking about paying for it with the Firestone credit card, there are some important things you need to know…Pressured to apply for a Firestone credit card?
This credit card isn’t just offered at Firestone Tires locations. Many other auto shops that sell Firestone tires also offer it.
This morning I was getting my rear tires changed at a local tire store (not a Firestone Tires store) and while I sat there waiting for my car, I couldn’t believe what I heard come out of the store manager’s mouth as he pitched the Firestone credit card application to customers. Statements like…
“You have nothing to lose. There’s no interest for the 6 months. Interest doesn’t start ’til after that.”
That’s not how it works. Let me explain…
Actually, the interest is deferred
Many people confuse deferred financing offers as meaning there is no interest during the first 6 months and interest doesn’t start accruing until after that. That’s not how they work.
With this credit card, if you don’t pay off your entire balance before the financing period is up (6 months, for example) then you will be assessed interest going back all the way to the purchase date. In order to avoid interest, you need to pay off every single dollar before the 6 months is up. If you don’t, you are going to be slapped with a great big interest charge for those first 6 months.
The brochure for the Firestone credit card actually does a good job communicating this; as you can see in the above display, they tell you this under the “No Interest If Paid In Full Within 6 Months.” But unfortunately the person who pitches you the Firestone card application doesn’t always explain it correctly (like Tony the manager whom I just talked about).
What is the interest rate?
Well unfortunately, it’s not exactly cheap. As we all know, interest rates change all the time, but at the time of writing there was a 22.8% APR.
Because the rate is so high, the Firestone credit card account is a very expensive way to pay for your tires if it’s going to take you 6 months or longer to pay it off.
What is the smartest way to pay for maintenance and repairs?
For those with not-so-good credit: There are still major credit cards out there for people like you. There are unsecured credit cards for fair credit that give promotional rates. With regular 0% purchase credit cards, you won’t be charged deferred interest. So if they offer you no interest for 6 months, it really means that… even if you end up taking longer than 6 months to pay it off. For this reason, 0% purchase credit cards are a better idea than the Firestone offer.
For those with good to excellent credit: For you, there are tons of options out there. In fact, there are usually major credit cards available that give 0% on purchases for 12 months. This is smart way to go, because (a) 12 months is plenty of time to pay off your purchase, and (b) major credit cards like Visa, MasterCard, Discover, and AmEx won’t do deferred interest, so it truly is an interest-free period whether you pay it off during that time or not. To see the latest offers, check out the best credit cards that give 0% on your purchases
updated for 2013