![]() Medical credit cards are also often seen as products used to entice people into elective medical procedures they would not otherwise be able to pay for. ![]() The CFPB found that 56% of subprime borrowers who made deferred-interest medical purchases in 2020 received a promotional period of 11 months or less compared to just 41% of superprime borrowers. One reason for the discrepancy is that consumers with lower credit scores are often given less time to pay off their balances before the deferred interest kicks in. In its 2023 Medical Credit Cards and Financing Plans Report, the Consumer Financial Protection Bureau (CFPB) said that while 20% of all people from 2015 to 2020 were charged deferred interest on their healthcare purchases, the percentage jumped to 34% for those with credit scores below 619. Medical credit cards are often viewed as a predatory financial product, marketed toward people in a tough financial situation. ![]() With high interest rates and limited acceptance, medical credit cards are not a product that makes sense for everybody and warrant serious consideration of the major drawbacks involved. In most cases, unlike a traditional credit card, a medical credit card can only be used with a specific medical provider or providers and cannot be used to make other types of purchases. The terms and conditions may vary greatly depending on the terms being offered at the point of service or in cooperation with the medical provider. Medical credit cards function on the same premise as any credit card: They’re loans from the card issuer that allow the user to make a payment for goods or services from a provider, in this case a doctor or other related health care professional, like a dentist, eye doctor or even a veterinarian. This means that, if you don’t pay off your entire balance by the end of the promotional period, you may owe interest charges for some of all of your original balance retroactively from the day that you charged a medical procedure to the card. Some never report payments to the credit bureaus.Īlso like many store credit cards, medical credit cards’ 0% introductory offers come in the form of deferred interest charges. Some medical credit cards have more lenient underwriting standards and accept all patients, regardless of credit. Some medical cards offer ongoing interest rates below what most other credit cards charge, but some can charge interest rates as high as the most expensive credit cards. Similar to other types of credit cards, medical credit cards may come with promotional interest rates, such as an introductory 0% APR for 18 months. What Is a Medical Credit Card?Ī medical credit card is simply a means of accessing short-term credit marketed toward consumers with medical expenses. Learn more about the pros and cons when it comes to medical credit cards. While they are much less common than regular credit cards, they are similar in that they are a revolving credit line that you must apply for, but often come with restrictions and caveats that limit their use. ![]() Medical credit cards provide a financing option for medical procedures or health care expenses.
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