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HELP: Buying a card with a credit card?

HELP: Buying a card with a credit card?

Question: I’m about to buy a car for around $14,000. I’m thinking about putting it on my American Express to get the points, and then getting a debt consolidation loan to immediately pay off the balance. Does this make sense? Would a debt consolidation loan’s interest rate be higher than an auto loan?

Also, where are some good resources for low interest rate loans?

Thanks!!!

Answer: That’s true with Mastercard and Visa, but American Express is a whole different beast. Some of their accounts, especially corporate ones, don’t have spending limits but instead require full payment on a monthly or quarterly basis. It’s common for AMEX cardholders to charge the full purchase price of vehicles on their cards and most large well established dealerships do allow it. It’s also not uncommon for a business to run all of their expenses through AMEX and have monthly bills exceeding well over $100k. When I worked for a large accounting firm with 300 or so employees, we would have Northeast gatherings at expensive locations like the Essex House hotel in NYC next to Central Park. As the head of the AP department at the time, we choose to charge the entire bill on AMEX. However, being a corporate card, it had no benefits.

I wish I had a personal card back then so I could have simply charged it and gotten reimbursed by the company. :)

I choose to not have a card now…

And to further add to the discussion here, BankOne is offering a card with 12 months 0% interest. If you KNOW it will be paid off in 12 months, it’s a great way to buy something you don’t have the cash for now. However, those “known payments” are beyond rare and almost never guaranteed.

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