Can credit cards be used for financing?

Credit cards can be used for financing if you are smart about it, and you are disciplined.

If you want to buy a large item that you think you can pay off relatively quickly, you could use the interest free days on your card. The number of interest free days you will have will depend on your credit card, but it can be up to 55 days.

If you have a credit card that offers 55 days interest free, this is the maximum number of days you can expect.

If you make a purchase on the first day of your card statement, then you will have 55 days before you have to start paying interest on that item. So, by purchasing the large item on the first day of the statement period, you can enjoy the maximum number of interest free days.

If you choose this option and you don’t pay off the purchase within the interest free period, think about how much interest you will be paying afterwards. It’s best to have a low rate card, so that you will pay the minimum amount of interest.

If you want to finance an item over a longer period of time, you may want to consider applying for a credit card with an introductory offer on purchases. These cards will give you a certain period of time with discounted purchase rates, so you can pay for larger items and pay little or no interest for a short time.

Choosing this option, be sure to check what the rates will revert to at the end of the introductory period. These rates may be higher than normal, so if you don’t manage to pay off the purchase before the honeymoon period is over, then you may get stung with high interest repayments.

Alternatively, if you have already paid for a large item on your credit card but are having trouble paying it off, you could also consider transferring the debt onto a balance transfer card. This will give you more breathing space to pay off what you owe, while paying less in interest.