UNDERSTANDING NEW CREDIT INSTRUMENTS
Most 90 days same as cash deals are not set up as traditional credit loans – they are more often what are called leases, and this allows the company to process the money in a number of different ways, and to offer financing to folks who would not normally qualify for a short term loan.
One of these is the 90 days same as cash option that leases make possible; the default option on this type of financing is a 12 month lease of whatever you are buying, whether it is music gear, yard equipment or tires and wheels.
When you are looking at the numbers by making monthly payments instead of using the 90 days same as cash option, the payback rate can be high (sometimes twice what is borrowed). But, there are more things to consider than the ultimate payback rate – many tire sets can be financed using leases for a little over 20 dollars a week., and a good set of tires can last for 5 – 7 years depending on how far you drive.
If normal financing is not available to you, this is a reasonable option to getting the equipment you need to keep your car in top running condition. Tires for many people are a major purchase, and this option can make it a bit easier to afford the quality equipment you need to keep your car in top running condition.
UNDERSTANDING THE 90 DAYS SAME AS CASH
The advantage to these leases is the 90 days same as cash option – this allows you to pay the entire loan within 90 days, and usually the only extra cost is a small origination fee (usually around $50 plus sales tax).
To use this option, most leases will withdraw your standard payment (based on how often you get paid), and it will be up to you to make additional payments so that the entire balance is paid off within 90 days.
It is very important that the final payment be made before that time period is over – we usually recommend making the final payment within 80 – 85 days just to make sure.
This is an excellent way to space out a one time expense that only has to be repeated every couple of years (depending on your driving habits and the amount of miles you drive). The payback rates can be high if you do not use the 90 days same as cash option, but if the payment is low enough it still may be worth it to get a new set of tires or the brake job that your car needs.
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