Household Retail Services Buyer Beware - Guitar Center & Deceptive loan sharking scam consumer fraud ripoff Wilmington Delaware

Any store that offers 0% financing will charge you the full interest at the end of the term. Guitar Center is not unique. These offers actually hope you will not pay it off so they can get the huge payoff.

The rules are usually in bold print near the top of the credit terms when you fill out the card application. However, you are supposed to get a statement each month. If you do not, call the credit card company and say you've never gotten a statement. They will usually give you an extra month to get the payment in.

I have to agree - the 0 % financing IS a good deal for the buyer - I've used it to get gear, and my customers used it when I was in sales. If your finances fluctuate, it allows you to get the gear earlier, and pay it off when the money comes in. You probably received a bill every month for 12 months describing the terms - unfortunately it seems that you didn't read those terms.

I am a Pro Audio, DJ & Lightning salesperson for Sam Ash Music. We also offer a range of different promotions on our "Sam Ash Backstage Club" card, which, like Guitar Center, is financed by Household Services.

A few comments here...

1) "Same as Cash" or "0 interest/0 payment" promotion plans on store cards are a GREAT way to help people get the musical instruments, PA gear, or stuff that budding musicians need to help get off the ground, provided that those promotions are USED CORRECTLY by the customers. As a salesperson, I require ALL of my BSC card customers to initial next to the promotion time AND the default interest rate should they not pay thier stuff off on time. This way, when they call corporate to complain that I didn't explain something to them, I can show them where the customer initialed, thereby indicating thier understanding of the payment plan.

2) These plans can be VERY destructive credit-wise to people who don't have discipline when it comes to making payments. If you don't have credit discipline, stick to using REGULAR credit cards with scheduled due dates.

3) Finally, it is important for customers to understand that the interest on thier purchase is NOT being "waived" or "discounted". Household Services is in fact charging interest to the account; however, Sam Ash (or Guitar Center in this case) is PAYING THE INTEREST FOR YOU on the account. The music store has struck a contract with the credit-issuing agency on YOUR behalf. If you don't live up to the bargain that YOU signed and agreed to, then you pay the price.

3b) side note - it's pretty much assumed that most people understand what "same as cash" means. If you don't, I suggest looking it up. It's not only Guitar Center that does this, but everybody from car dealers to furniture stores use similar promotions. I suggest you read up.

There's no "caveat emptor" or "buyer beware" about it. Just READ WHAT YOU ARE SIGNING, and you will be more successful not only in business but life as well.

I used to be a manager at a Guitar Center in So. California. For the record all the information regarding the intrest rate and having to pay all the intrest after the promotional 12 months same as cash ends is all printed on brocheure you filled out. If you are that uneducated about the credit world and don't understand the terms that were disclosed then you seriously need a lesson in financing and the world of credit cards. I'm not some capitalist a-hole who thinks promotional financing gimmicks are a good idea, but you were defintely given fair warning - even if the salesperson was a dope and didn't inform you its your responsibility to read before you sign. And further more why are you letting your balances sit there for over a year? Not a good idea.

Not only does Guitar Center practice this deception, every retailer does. When you see an offer that states: "Zero payments, zero interest for one year," it is a sales gimmick that all retailers use. Here's what happens:

When you purchase an item using that retailer's credit card, you are taking out a loan from a financial institution. If the loan is paid back in the advertised time period, there will not be any interest charged to you. However, if it takes you longer than the advertised time, the interest is accrued from the day the loan was made, which is the usual case. In some rare cases, the interest will be accrued on the unpaid balance from the day the loan was made.

Here's an example: If you purchase an item for $1000 and pay half of it off within one year, your interest will be accrued on $500; but from the day the original purchase was made.

You must read the fine print before you make the purchase. Caveat emptor (buyer beware).