PayPal Buyer Credit

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Is that piece of gear REALLY worth it?? – Joe

SUMMARY: Is that piece of gear REALLY worth it??

I was looking at some gear on eBay and noticed that PayPal now has an extended payment option for purchases. I was curious so I checked it out.

Then I got out the old spreadsheet and calculated what the effective interest rates were on these balances due if you made the minimum payment every month.

Loan Amount

Minimum Monthly Payment

No. of Payments

Annual Interest Rate

Total Payment

$200

$10

25

22%

$250

$400

$17

52

43%

$884

$1000

$42

88

49%

$3,696

$2000

$84

116

50%

$9,744

$3000

$125

132

50%

$16,500

A little steep, don’t you think?

Again, you can see the full schedule HERE.

Now to be fair, you can pay off this off as quickly as you like, but these are very high rates, much higher than those even for credit cards. Paying the minimum amount is NOT going to do much for your wallet. Sure, people who sign on to something like this are short of cash, but with terms like this, they’ll stay that way.

I also find it interesting that these rates are not displayed anywhere, at least not anyplace I can easily find.

CONCLUSIONS

Nice business if you can get it! If you can top this, please send me the details.

Email Joe

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