Some of the credit rating agencies lower your credit rating if you do not have any installment loans in your credit history. Has anyone looked at their credit reports after paying off an Apple purchase using their monthly payment plan to see if it was reported as an installment loan? I have not been able to find anyone at Apple or Goldman who can answer this question.
The way it is reported is like having an outstanding balance on a credit card. It is NOT reported as an installment loan.
The entire charge total hits against your credit limit first. You pay toward it at 0% interest. In the end, it is an outstanding balance on your credit card.
Axel F.
The way it is reported is like having an outstanding balance on a credit card. It is NOT reported as an installment loan.
The entire charge total hits against your credit limit first. You pay toward it at 0% interest. In the end, it is an outstanding balance on your credit card.
Axel F.
I never thought of it as an installment loan because an installment loan has only the total initial balance and nothing else can be added to it (A car loan for example) for the life of that installment loan.
In the Apple Card and iPhone example, it is still a charge to the credit card with flexible 0% interest free payments on one of the several possible purchases using a portion of the total credit limit. Therefore, still a credit card charge.
Axel F.
Thank you. That is unfortunate. If It were reported as an installment loan to the credit rating services it would let customers boost the credit scores by purchasing Apple products on the installment plan. It would be interesting to know why they are treated differently because from the consumer’s view they appear the same.
How are installment purchases reported to credit rating agencies?
