If I bought something for $1,900 with paid deferred interested and don't pay it

  1. isharkbait profile image94
    isharkbaitposted 3 years ago

    If I bought something for $1,900 with paid deferred interested and don't pay it all off...

    If I don't pay off the $1900 by the one year mark what happens? Will I be charged interest for the original $1900 I used, or for the $500 that is left on the account? What will this do to my credit score? If the minimum payment is $100, how long will it take me to pay it off? This is my first experience with using credit and I feel like I am in over my head. Thanks!

  2. LindaSmith1 profile image61
    LindaSmith1posted 3 years ago

    Here is a link to information about deferred interest.
    http://www.consumerfinance.gov/askcfpb/40

    Just put deferred interest in their search bar.

  3. Venkatachari M profile image42
    Venkatachari Mposted 3 years ago

    I think interest will be charged from the day that you used your borrowed fund. So it will go on accumulating to your account in compound calculations. It depends on the terms and conditions of the credit card provider. Normally, your interest is calculated on monthly balances. So if you are paying regularly, your interest will go on decreasing month by month. First they will charge on $1900, then if you pay some amount, they will subtract the amount and calculate interest on balance amount.
    Here also, suppose your interest for one month on $1900 is 190, they can subtract the amount paid by you say $100 from the interest only and your principal may stand as it is and they will again calculate interest on full amount of $1900 for next month also. All this depend on their terms and conditions.
    So it is better you pay each month more than the interest due for that month so that some amount of your principal will also get reduced from your payment.
    You will have to consult your lender for full details.

 
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