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By Gavin | April 15, 2019

I'm going to do a review of care credit financing.

Care credit financing is a form of financing generally for medical and dental procedures that are elective procedures things that are not generally covered by your primary health insurance. It can be for a lot of different things, sort of across the spectrum, but commonly it is for things like cosmetic, dentistry, LASIK, eye surgery, hearing aids, weight loss procedures, vision, eye exams, and eyeglasses, it even goes into things like day Spas and veterinary procedures for year pets. Care Credit is also accepted at Rite Aid drugstores and it is accepted at other places as well, but that sort of gives you an idea of what it is now.

You can apply for Care Credit on your own online if you want to, but generally the way that you are going to get involved with Care Credit is that you are going to be in a situation where you want to have some sort of procedures, such as the ones that I've just mentioned in your doctor's office, dentist office, whatever may offer you a Care Credit, in order to pay for a procedure that would not be very easy for you to pay for all at once, and usually what is going to happen if you are going to get a 0-0 percent Interest offer provided that you pay off the balance of whatever the procedure is over these certain periods.

Generally, the way Care Credit works as if long as it is over $200 you can get 0% financing for 6 months, 12 months, 18 months or 24 months, depending on the procedure, depending on how big the procedure is. Now if you have an even larger procedure and you want to string it out even further you can do that, but not at 0%. If you have an over $1000 procedure you can string it out to 24, 36, or 48 months at 16.9. If you have over $2,500 procedure you can string it out to 60 months which is five years.

I have a 14.9%, but what I want to talk about actually are those 0% offers in particular, because I want to make sure that you understand what that means. These are deferred interest offers, which means that you absolutely have to pay off all of your balance within that period that you are given at that 0%, or what's going to happen is that you're going to get all the interests tacked on that would have accrued from the day that you are charged for the procedure if you haven't paid off every penny. What that means if that didn't make sense to you.

Assumed you had a procedure for I don't know a dental implant or something along those lines and it costs $2,000, and you really felt like you needed to have it, you wanted to have, it is noticeable whatever, and you decided what I'm going to take this financing, I'm pretty sure I can pay off that 2,000 bucks within the next 24 months.

So you have the procedure, you now have two thousand dollars, you owe over those next two years, at 24 months you pay off assumed eighteen hundred and fifty dollars of it. So now you only owe one hundred fifty dollars left after all that time. What's going to happen is because you didn't pay off every single penny within that two year period that you were given, they're going to act like the zero percent offered never existed and they're going to charge you interest from the day that the procedure initially happened.

And you were charged for it all the way up until that time, and they're going to charge it to you at their regular interest rate which as of now is twenty-six point nine percent. I mean you get charged interest and then hold two thousand dollars over for a two-year period, which means that two thousand dollar procedure now turns into an over three thousand dollar procedure when you tack on all of that interest that would have accrued over those two years.

So you have to understand if you don't pay off every single penny within that period that you are given, that you are going to get charged all of the interest as if that zero percent offer had never existed, and it's going to be at that very bad twenty six point nine nine percent interest rate.

So in terms of how care credit works and what I feel about Care Credit, if you have a procedure done and you're sure that you can pay it off within this sort of zero percent time that you're given, that's fine. But the thing that bothers me a little bit about Care Credit versus maybe some other financing offers out there is that I feel like a lot of the procedures that are done, these medical procedures, dental procedures, maybe a procedure on your pet oftentimes. It's easy enough to sort of not give into temptation.

If you're buying like if you're thinking about buying a new purse, or you're thinking about buying some furniture, and you think about the financing, you go. I don't know if I can pay it off, it's a little easier to walk away from that, then sometimes it is easier to walk away from a medical-dental procedure or something like that where you feel like you really want it.

You're already in the doctor's office that if you get this financing that you can get this thing done and you feel like it would make your life a lot happier, or that this is something you really feel like you need, so that you're in sort of a more vulnerable position in terms of sort of your psyche or your emotions around it.

So then when the Care Credit is offered to you I think you're more likely to take it, even if you're not in a position necessarily to pay off that complete balance within that 0% period that they give you. So you need to be very careful when that is offered to you, to think about whether you can pay it off.

And realize that your desire to have a procedure done or whatever can sometimes sort of outweigh your logic as to whether you should do that. So if you are in that position and you feel like you really do need one of these procedures assuming your credit is good enough, what you should probably do instead is to try to get a like a Visa or MasterCard that gives you a 0% introductory period on purchases, and hopefully you can accomplish the same thing without having that potential to have been socked with all this interest on the end.

Say you've got a card that has 0% interest for 15 months, you put your medical procedure or whatever it is on to that card, assume you try to pay it off within that 15 months, but say you don't even pay it off fifteen months, and say you still have like ten or twenty percent that you didn't pay off, you're only going to end up getting charged interest in that case on whatever is left of that balance, so that makes a lot more sense to me than using Care Credit.

Now Care Credit probably is going to  allow people with lower credit scores to be accepted, where some of the other general market cards may be a little more difficult, but if you have the option that is something that I would suggest you do instead of Care Credit, a couple cards that we talked about, the chase slate or Bank of America BankAmericard, both have 0% interest for fifteen months, but there are other cards on the market as well.

So you might want to consider doing one of those if you have a procedure that you really need to get done, really want to have done instead of going after Care Credit, so that's it.

Overall I don't necessarily have an issue with what Care Credit is doing, there is the reason that you would want to have these procedures done, and that you would want to string out your payments, but you have to be so careful with it, and if you have a different option to string things out at a 0% rate I would take that instead of Care Credit.