Is it a good idea to buy a car on a credit card?

Checking Credit Card

Rewards credit cards are a great thing to have and it looks like one man from Virginia had a brilliant idea on how to use his to its full potential!

According to MarketWatch, Chris Mixter, a 39-year-old IT consultant, wanted to get a new car and also tried to get a free vacation out of it as well. But how did he actually do it?

If you can get such great rewards, why not try more?

Mr. Mixter put the car on his rewards credit card, in order to get all the rewards points he needed, in order to be eligible for a serious prize. And he wasn’t new to this, as previously, he and his wife also enjoyed three trips, just with the points they gathered. And this included a honeymoon in Aruba as well, alongside two trips to Disney World.

However, a car is a pretty serious purchase and even though, technically, it’s possible to put it on a credit card, as long as you have a credit limit that’s big enough. On the other side, this is not something that’s recommended, unless you can’t pay the purchase in the first month.

Eventually, the purchase can end up costing months with the annual percentage rate factored in, as Chris Mixter found out. Since he wasn’t able to pay this in the first month, he had to scramble a bit.

But how was this possible?

Specifically, he didn’t want to start racking up interest, as the charges were pretty big. And he couldn’t use a dealership loan either, since he was paying for the car on a credit card.

Eventually, he opened three 0% APR balance-transfer credit cards, then shifted balance from a card to those. Before starting to collect interest on those cards, he will pay them. For the next 14 months, there will be 0% interest on the three cards, so he has just enough time to do this.

To wrap it up, getting a car on a credit card might not be the brightest idea of all time, but if the dealer is open to negotiate, you can give it a try.

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