Easy Finance - Help!

Please, let me encourage you not to start the practice of going into debt to fund your home theater ambitions. This hobby is addictive and if you don't make a firm commitment to spend within your means it will eat you alive!


Yeah, sure, today it is just a few DVD's playing through an HS20 projecting onto a piece of blackout cloth. But before you know it, you'll be watching DTheater tapes and high-definition pay-per-view on your Sony Qualia projector projecting onto a 133" diagonal retractable Greyhawk! All the while, your financiers are repossessing your cars and the furniture around you! Yeah, you'll have a smile on your face, of course: because MY GOSH the picture is incredible. But when they take the couch you're sitting on, you'll have to pause the movie long enough to stand up, and with any luck it will be right in the middle of a key action scene! Besides, they'll probably need the light on to get it out of the room, and that destroys the contrast.


*ahem* sorry. Got carried away there, but my point is serious. Don't pay interest on home theater purchases. Stuff the monthly payments in a shoebox until you have the right amount saved up. Your wife won't be able to argue with your fiscal discipline, and before you know it you will have a sweet projector. What's more, by the time you do have your money saved up, even better projectors will be available for the same price that you were going to pay today (or the one you want will be cheaper).


True no-interest financing, if you can find it, is a reasonable option; HOWEVER, the store has to make money somehow, so chances are they aren't going to discount the projector as heavily as they would if you were paying cash. But if you do find a genuinely good price and an offer for zero-interest financing, hey, more power to you. If they want to be your shoebox, go for it.


That reminds me, make sure to shop around---in particular, contact the good folks here at AVS, the ones that host this very forum. They will give you a competitive deal and good service.


OK, enough moralizing though. There is a practical challenge, as you're seeing: the stores that sell the nicer projectors are generally smaller chains (or just individual stores) that don't offer financing. And I assume you're avoiding the credit card route for a reason, too. Plus, many consider these front projectors low-volume specialty items---the people that want them know they want them, so there may not be as much incentive to offer attractive pricing or financing.

There are two reasons I'm leery of 0% financing from stores. One I've already mentioned. The store has to make money somehow. With 0% interest, they're sure as heck not making money on the financing. So, do you really think they're going to discount the unit as much? So paying cash is always going to give you more bargaining power than 0% financing. So I'm not totally against 0% financing, as long as you are sure that you're going to pay it off and not suffer the interest penalty if you don't, but I still think cash is better.


The second reason is, you just don't now what's going to happen with that money you're making payments with. Back in late '99 I bought a new car. I had the money to pay cash, but I looked at their 3-year lease terms and the equivalent APR wasn't that bad---a heck of a lot lower than I was making in my investments. So in theory, by going with the lease (with the full intention of buying the car at the end of the term), I was actually going to come out ahead.


In theory. The bottom dropped out of the stock market not long after that, and the interest I paid on that lease proved unnecessary costly.


The next car, I paid in cash. So far, investments would have paid better, and the same trick with the lease would have been a winner, this time. But a bird in the hand...


As for borrowing from a 401(k), no way. Not for luxury items. Maybe for the down payment on a home, or if you're desparate, on something else you need.


Yeah, Art, I know, we're no fun... but the way I figure it, someone who's in home theater over their head financially isn't going to be in it very long... and we want 'em around a long time, right?

dept stores certainly do make money of those 0% financing offers. The whole trick is that not only is it zero percent for a year - they are also no required monthly payments for a year. The fine print says if you do not pay the full amount in a year then they sock you with the very high interest retroactively. They make their money because most people go into it saying I do not have to pay for a year! Guess what happens at the end of the year when they have not paid? They don't have the money! And the dept. store laughs all the way to the bank - because the same consumer comes back on the next no interest no pay deal - because they cannot afford payments right now because they are paying off last years deal! And the customer cannot go to another store - because they only have that dept stores credit card!


We have a rule in my house - do you want it (cash) or need it (credit). Nobody needs anything HT as bad as they want it (except for me as I am an AV dealer!). I need it so that my customers will want it! My wife is still trying to figure out that loophole!

You are financing a projector...

Zero percent financing would not exist if stooges all paid in the year..



Reality is that most people do not pay it off... then the cost is through the roof... Even the initial cost is more to purchase using this method...


The store gets a cut of the action... check out the interest rate .. in most places it is actually an illegal rate of interest if taken as strictly interest..


Why do so many of the money marts exist... it is from guys buying HT equipment or other toys on credit... a bad spiral to start with...


I have lawyers, doctors, accountants, business owners buying equipment all the time... I used to be a VP finance ...... there is absolutely nothing wrong with purchasing a projector for your business... practice... In fact some hold their monthly meetings, budget, planning, education, etc in the homes and write off the room.. There is absolutely nothing wrong with doing this..


Even tho my showroom is filled with screens and projectors ...it is still a cash flow drain.. and the only time I get to see any of it is when a potential customer wishes to view...