EXCELLENT customer service, and a good card for the fiscally responsible.
Written: Jan 25 '02
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Pros: Easy to get a card, deferred interest, excellent customer service
Cons: High interest rate, not for those who are lazy about paying off a card
The Bottom Line: If you know how to manage your money and make payments on time, this card can give you a valuable credit-free option when making major electronic purchases.
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| sinkerswim's Full Review: Best Buy Credit Card (Household Bank) |
Best Buy is a major electronics/appliance store located in numerous states in the U.S. (400+ stores in 41 states). Its store card is managed by Household Bank (HRS), which took over the card accounts sometime in the last two or three years. Before that it was managed by Beneficial Bank.
The card allows you to make in-store or internet purchases at Best Buy only (similar to a Sears card). A Best Buy card is very easy to get compared to a regular credit card. When I applied for my card in 1998 I was in graduate school with school loans, a well-paying but low-hours job, and a not insubstantial amount of existing credit card debt. They gave me a $3000 credit line that I used to buy a laptop. I remember thinking at the time that the process was pretty easy and the amount of credit very high for my financial situation.
The main benefit of the Best Buy card is that they run various promotions for large purchases (some on a constant basis) where you can get 3, 6, or 12 months of interest-free payments. This means you can buy, say, a $699 TV and have 12 months to pay it off without paying any interest on the credit charge (of course, the price on the TV probably will drop $50 in that period, but you get the instant gratification and interest rate savings). The reason Best Buy runs these promotions, from what I can tell, is that it guarantees a steady income flow and can push purchasers to "buy now" instead of "buy later and maybe somewhere else." These promotions usually are not offered on smaller items, such as CDs or DVDs.
The danger with the card, and the reason you need to be fiscally responsible, is that if you run your credit charge past the promotion date, interest on the credit charge is accrued back to the date of purchase. That means that you will get charged 12 months of interest on that $699 TV, and the benefit of the promotion is basically wiped out. And the interest rates run pretty high, usually in the upper-teens to 20% range (as of 1/15/02, the rate is 19.8%). So you MUST pay off things within the promotion period or you're better off having used a different credit card. I have heard people complain (and read complaints here on epinions) that this whole process is a big rip-off. But, with the exception of my first purchase (the laptop), I have always paid within the promotional period, and I have not had any problems with any purchase. Like my title says, it's a good card for the fiscally responsible. If you can't manage that task, then look elsewhere for a credit card.
Now, if you want to be clever, at the end of a promotion period, you can just transfer the balance to another credit card (maybe one with a low balance transfer rate) and, tada!, you have just taken a 12-month interest-free loan. But make sure you time it right, taking into consideration monthly billing cycles and payment processing time.
Other than the interest-free plans, there are not any other real benefits to the card. They do send you occasional coupon offers that are pretty good and do not require you to use the card.
Probably the best thing about the card to me is the customer service. I have made a couple of calls about changing addresses and the like, and I always found them to be pleasant and helpful. But what floored me was that one day I received a call from HRS saying that someone had tried to open a Best Buy card account online using my name and SSN. They located my current account, denied the fraudulent account, and assigned an investigator to follow up on the case. I received a letter from the investigator about what had happened and the process they went through to prevent a fraud. They also gave me advice on how to prevent any further fraud attempts. This allowed me to quickly cancel another online credit card application taken in my name and put a "fraud alert" on my credit report. Without the helpful assistance from HRS I probably would be looking at the long, painful process of ridding myself of identity theft and repairing my credit rating. Their conduct epitomized the meaning of the phrase "above and beyond."
All-in-all, I recommend the card to those that think they can manage an account responsibly. I have used it several times to make major electronic purchases (e.g laptop, TV, DVD player) and I like knowing that I can pay it off over a period of several months without accruing interest.
Recommended:
Yes
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Epinions.com ID:
sinkerswim
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Location: Washington, D.C.
Reviews written: 4
Trusted by: 0 members
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