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Author: dcoutts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 308847  
Subject: Are CCs best for a $5000 project? Date: 8/7/1998 12:03 PM
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Please help.

We have a $5000 landscaping project coming up that we need to pay for. I am trying to figure out the best way to pay for it. Here are some things that may help:

- We dont have any credit card debt
- We have equity in our home and good credit
- The landscaper does not take credit cards
- We dont have enough money in the bank to write a check
- We could sell some stock to get the money

My initial thinking is to use a Cash Advance Check from a credit card and pay the credit card back within about 1 year (using an intro rate card and probably transerring once).

The only problem is that every credit card Ive found charges you 1%-3% when you use these checks. Thats between $50 and $150 right off the top!

Is there a better solution?
Would a home equity loan be better? (I dont know much about these)
Does anyone know of a credit card that has a low rate and does NOT charge for the checks?

Thanks!!

PS. I want to avoid selling any stock.
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Author: BeDucky Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3774 of 308847
Subject: Re: Are CCs best for a $5000 project? Date: 8/7/1998 12:31 PM
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- We could sell some stock to get the money

How about a stock-secured loan? At about 9% interest, you can sometimes get this through your broker, but many credit unions and some banks offer this option. Usually you can take out a loan somewhere between 50%-66% of the value of your holdings.

Since you are a software engineer... I don't know about NC, but in the Seattle area there's a credit union for employees of high-tech companies called First Tech. You may want to look for something similar near you, or you may find a CU based on locality.

A home equity loan might not be a bad idea, but it may cost you more in origination fees, appraisals, etc. Some banks/CUs may have a deal for no closing costs if you have a loan of $5000+. A 5-year home equity loan at First Tech is about 8-8.25%.

You may also be able to get an Equity Line of Credit from your bank, which is usually an account you can write checks on.

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Author: Helter Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3775 of 308847
Subject: Re: Are CCs best for a $5000 project? Date: 8/7/1998 12:33 PM
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Wait until next year and pay cash. If its a problem that needs to be fixed, do it yourself.

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Author: mjskas Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3787 of 308847
Subject: Re: Are CCs best for a $5000 project? Date: 8/7/1998 10:35 PM
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we need to pay for.

Want? Or Need. Big difference. I agree with Helter. If it is for a newly purchased property, realize that large improvements can be done by many small improvements over time.

Good Luck,

Mike

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Author: TMF2Aruba Big funky green star, 20000 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3791 of 308847
Subject: Re: Are CCs best for a $5000 project? Date: 8/8/1998 10:05 AM
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Want? Or Need. Big difference. I agree with Helter. If it is for a newly purchased property, realize that large improvements can be done by many small improvements over time.

Okay, I wasn't going to put my comments on this, but I decided to chime in anyway.

What concerns me is your comment that you don't have enough in the bank to pay for this. This suggests that you're doing a job that you can't really afford now and are willing to go into debt for it.

My question is now necessary is this landscaping job that it has to be done now? Can it wait a year? Are there ways you can do a few things in the yard without going into debt and save the big items for later on.

When my wife and I do projects around the house, we always wait until the money is there for it. I don't want to have to feel the pinch simply because we couldn't put it off. My wife is one of those people who wants it right away, and I have to hold my ground on the big things.

However, by waiting, the projects always seem to have so much more value, we enjoy them even more, and they don't become a burdon.

Tony
...but I still am...

Off2Aruba

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Author: TMFRunkle Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3792 of 308847
Subject: Re: Are CCs best for a $5000 project? Date: 8/8/1998 11:16 AM
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Let me add to Tony's post. My wife and I needed to get our kitchen renovated before we sold the house. The floor looked like hell, and the counters were downright nasty. Also, the wall paper behind the fridge was coming off.

We could have renovated it with a credit card, but elected to hold off. We saved up for it every month until we had the total in cash. It killed me to fork over $2,300 in cash to the guy, it was worse than using a credit card. Something about if you have it, you don't want to spend it.

In the end though, the kitchen was paid for. Our sold in 2 1/2 weeks by the way, I don't know if it was the kitchen that helped or not. The realtor says it probably was.

George

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Author: mharris Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 3804 of 308847
Subject: Re: Are CCs best for a $5000 project? Date: 8/9/1998 12:21 PM
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>> Wait until next year and pay cash. If its a problem that needs to be fixed, do it yourself. <<

I agree. I just found out that I need to reside my house because there are problems with the old siding. There is no way I can pay for that right now, so I am going to patch and limp along for the next 6 months to a year until I have enough cash to contract the job or learn enough to do it myself. I would say that unless your landscaping problem has to do with water in your basement, it is not critical to get it done right now.

Hey, I am going to have to live with the ugliest mint green vinyl siding you have ever seen for a year!!

-Matt

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