I’m a firm believer that information is the key to financial freedom. On the Stilt Blog, I write about the complex topics — like finance, immigration, and technology — to help immigrants make the most of their lives in the U.S. Our content and brand have been featured in Forbes, TechCrunch, VentureBeat, and more.
See all posts Frank GogolHow to Get an Appliance Loan
Updated on April 9, 2024
Written by
Written by
Reviewed by
Rohit Mittal
Reviewed by
Rohit Mittal
Rohit Mittal is the co-founder and CEO of Stilt. Rohit has extensive experience in credit risk analytics and data science. He spent years building credit risk and fraud models for top U.S. banks. In his current role, he defines the overall business strategy, leads debt and capital fundraising efforts, leads product development, and leads other customer-related aspects for the company. Stilt is backed by Y Combinator and has raised a total of $275M in debt and equity funding to date.
See all posts Rohit MittalA broken appliance almost never comes at a good time. And, buying a new appliance is not cheap! Chances are you didn’t plan for it so you don’t have the money available.
Fortunately, you can get an appliance loan to help you cover the cost of buying a new appliance. Below we take a look at what appliance
The Cost of New Home Appliances
Having to replace an appliance which suddenly breaks catches most people off guard. Appliances aren’t cheap and, usually, you also don’t want to buy the cheapest option on the block.
Let’s take a look at what a new home appliance could cost you:
- New fridge: $900 – $8,000
- Oven: $650 – $2,000
- Washer: $350-$1,000
- Dryer: $400-$1,000
- Dishwasher: $400-700
When you have to suddenly cover the cost of buying a new appliance, it can seriously wreck your budget. No one really ever really plans for an appliance to break. So most of the time, you’re not prepared for it!
This can cause some serious financial pressure if you don’t have emergency funds available and most people are not in a position to cover the cost immediately.
Why You Shouldn’t Make Appliance Purchases on a Credit Card
If you’re in sudden need of immediate funds to replace one of your home appliances, it can be an easy mistake to cover the cost with your credit card.
Doing this, however, is not always the smartest option. Making large purchases, such as buying an appliance, on your credit card, increases your utilization rate. Initially, this will cause a bump on your credit score. Interestingly, credit utilization is the second most important factor when determining your credit score (right behind payment history).
Credit utilization is also known as your balance-to-limit ratio. This ratio is calculated by taking your total balances on your credit cards and dividing it by the total of your credit card limits. Ideally, you want your credit utilization to stay below 30%, as the lower your utilization rate, the lower your credit score will be.
So, if you make a large purchase on your credit card (as opposed to making use of an appliance loan, for example), your credit score might take an initial knock.
Taking this into account, let’s take a look at appliance
What are Appliance Loans ?
An appliance loan is essentially a personal loan you get so you can pay for your new appliance.
A personal loan is usually an unsecured loan which you take out from private lenders like Stilt. This means you don’t need to give collateral (like an asset) as security for the money you borrow.
The terms and rates for personal
- Loan amounts between $1,000 and $100,000
- Repayment terms between 6 months and 7 years
- Interest rates between 5% and 20% (although this will depend on your credit record and if you are signing with a cosigner).
Taking out an appliance loan won’t have the same impact on your credit score as using your credit card to buy your new appliance. Getting a personal loan is also quite easy and the funds are usually available within a week. So if you’ve got an emergency and you need to get an appliance asap, getting an appliance loan is a great solution!
Getting an Appliance Loan with Stilt
Getting a loan with Stilt is quick and easy.
You can apply online, which makes the process so much less complicated and tedious. Once you’ve applied, Stilt will send you an update on your application within 24 hours. If they need more info, they’ll schedule a quick verification call with you.
Your information and documents will need to be verified, but as soon as they’ve ticked all the boxes they’ll send you a promissory note to sign. Once you’ve signed, the money will be transferred to your account. It only takes about 2 to 3 days to reflect in your account, so you’ll have your money and be able to get that appliance in no time!
6 Tips to Save Money on Appliance Purchases
If your appliance broke unexpectedly and there is no way of avoiding getting a new one, you want to make sure you get the best deal! Take a look at our tips below on how to save money when you’re buying new appliances.
1. Utilize Rebates
The demand for energy is high. So, to incentivize consumers to purchase energy-efficient products, some manufacturers or utility providers offer a utility rebate if you purchase energy-efficient products. There might be one or two steps involved in order to get your rebate, but this is basically a discount on your product – you just receive the cash back later.
So, make sure you check out the rebates available on Energy Star or your utility provider’s website!
2. Use Online Price-Matching
Many big retailers offer to match the best price you can get on a product other at their store. Sometimes, they even offer to beat it! This is called price matching. This is a good reason you should do your homework on the prices that are available out there and the different companies’ policies. Shop around for deals and, if you have a favorite retailer who you trust, ask them if they’ll match the price.
Retailers such as Home Depot offers a “low price guarantee” meaning they’ll beat the best price of their competitors with 10%. Best Buy is also one of the retailers who will offer to match any price you can get from a competitor.
3. Skip the Extended Warranty
Extended warranties might sound like a good deal. You are guaranteed of the product lasting for a longer period of time. But this is just another way retailers make a big profit without it being a good deal for you.
The likelihood of your appliance giving problems before or during the extended warranty period isn’t that big. Even if it does, the cost to repair the defect is often not even as big as the price you paid for the extended warranty!
4. Buy Used, if Possible
If your budget is small but you really need new appliances, buying used appliances isn’t always a bad idea. There are many used-appliances stores out there that sell refurbished used products. These products even come with warranties.
Be careful about buying used appliances from places like Craigslist or eBay though. You never know what you are going to get and you might end up wasting the only money you had!
5. Get Email Quotes
With today’s technology, there is no reason you have to walk from store to store to shop around and get the best deal. You can ask for quotes on appliances via email. This makes the comparison process so much easier and will also prevent you from being convinced to make a bad purchase by a nifty salesman.
6. Look for Free Delivery
If you are comparing prices of different appliances at different stores, make sure you take into account the delivery fee they charge for delivering the appliance. A good idea would be to look for a store that offers free delivery. This way, you can spend more on the appliance and not lose value on transportation costs.
Conclusion
Breaking an appliance doesn’t have to be the end of the world or the end of your budget this month! Yes, buying new appliances are expensive, but that is why Stilt is here to help. If you need cash to cover a new microwave or fridge, take out an appliance loan today. You’ll be sorted in no time!
Frank Gogol
I’m a firm believer that information is the key to financial freedom. On the Stilt Blog, I write about the complex topics — like finance, immigration, and technology — to help immigrants make the most of their lives in the U.S. Our content and brand have been featured in Forbes, TechCrunch, VentureBeat, and more.