I have been told about the benefits to my credit score to have a paid off non-revolving loan (i.e. not a credit card) on my credit report.
I'm going to be buying new furniture in a couple of months and I'm thinking of taking out a small bank loan to do this. My idea is that if the furniture costs X, I would round X to the nearest thousand or so and take out a loan of that amount. I would then pay off the loan at an accelerated pace.
I have the money to buy the furniture outright, so I wouldn't be going into debt for this, and I accept that I would pay a small amount of interest, but the benefits of having the loan on my report and the relationship it would build with my bank seem to be worth it (perhaps a good mortgage rate may come of it).
Would it be better to take out, say, 5X and put the difference in a short term (3-6 months) investment? The interest I would get seems not worth the trouble.
Thoughts from the financial gurus here?
I'm going to be buying new furniture in a couple of months and I'm thinking of taking out a small bank loan to do this. My idea is that if the furniture costs X, I would round X to the nearest thousand or so and take out a loan of that amount. I would then pay off the loan at an accelerated pace.
I have the money to buy the furniture outright, so I wouldn't be going into debt for this, and I accept that I would pay a small amount of interest, but the benefits of having the loan on my report and the relationship it would build with my bank seem to be worth it (perhaps a good mortgage rate may come of it).
Would it be better to take out, say, 5X and put the difference in a short term (3-6 months) investment? The interest I would get seems not worth the trouble.
Thoughts from the financial gurus here?