Worth getting a credit card to save $100

[farley2k]

Sony has a deal where if you get their credit card you get $100 off your first purchase over $299 and no interest for 12 months. Since I plan on buying a PS3 anyway and it is $399 that means a savings of $100. I am just wary because I assume there must be some catch, but I can't find anything in the details which looks bad. Basically it seems I can get the card, buy the PS3, pay it off, and then cancel the card with no repercussions. But is that a good idea?

Thanks for the opinions.

[72Tiger]

your credit rating will probably get a ding if you open and close an account like that.

[hermione]

Which bank is the Sony card from? Is it a well-known and respected institution?

Does the card come with other benefits like rewards or cash back that would be of use to you?

If you do decide to get the card (after being sure that there is no catch and no annual fee), I'd suggest you get your PS3, pay it off, and if there are no other benefits, just keep the account open without using it for at least a year (better to go at least a month or two over the year) before closing it.

If there are benefits that you can get from using it normally - like 1% cash back on all purchases (not just buying electronics you don't really need), than you might consider keeping it to "earn" a little money.

Even if the account stays open and unused, it would show up as "excellent standing" on your credit report, which is a good thing. If your debt to credit ratio - actual debt compared to total credit limit - is low, it makes your credit look better.

When we were applying for our mortgage, we were very lucky that we had paid off our car in 13 months and not sooner; we didn't have very much credit history and our loan officer said that creditors look for accounts that have been open for at least a year.

I'm not an expert on this stuff though, so I may be wrong, but this is based on my personal experience.

[dapooh1]

The "catch" is probably that most people get the card intending to pay it off before the interest-free period is up but then don't and end up paying a rediculous interest rate.

I applied for a mechanic shop's store credit card when my last car needed about $1000 worth of work done so that I could get the 10% discount. Of course, I paid the bill as soon as it came. When I bought a "new" car a few months later (after another big repair), I had no trouble getting a really great loan from the dealer so the credit application couldn't have dinged my credit score too much.

[Livingalmostlarge]

Heck ya. I did it with a furniture card and it's paid off afterwards. $100 is a $100.

[purplefdu]

The Sony card is through a reputable bank so far as I know last I checked. The terms are really just to convince people to get a Sony card instead of another type of card. Its like the Walmart card where you can get a case of soda. Most people are going to use their Sony card at the Sonystyle Store and spend way more than $299 to Sony makes out in the long run as they pay off the $1500 laptop at whatever interest it carries.

As far as I understand it paying things off early doesn't "ding" your credit so much as not really help it. Yeah you got a card, but you didn't really use it and they are looking for payment consistency and the fact that you will be paying interest plus the purchase price or keeping the account for a long period.

[72Tiger]

the paying it off won't ding your credit, but instantly cancelling or closing the account after you do most likely will.

[Tightwad]

Sounds like a great deal! Just be sure to get the card issuing bank name. If it's someone you have had trouble with in the past, you may not be accepted. Chase still has me on their black list 15 years later.

Since it's a store card, it will probably have 23% or so interested, so buy your console and then pay it down as quickly as possible so they can't hose you on interest. Then stick it in the sock drawer.

Your credit report (FICO) will probably take a 3-5 point hit. No big if you are comfortably in the 700s, but if you are floating around the high 600s, do so with caution.