Editorial Policy

Best ways to finance pricey dental work

Erica Sandberg

June 20, 2016

Q Hi Erica,
I need three crowns for my teeth, and the estimated bill is $1,800. My dentist has already given me a discount. My insurance won’t cover this. My dentist offers CareCredit for payments. What do you think about CareCredit, and will using CareCredit hurt my credit? — Jason R.

A Dear Jason,
Companies such as CareCredit can be a smart way to cover medical expenses. Of course, the best method is cash (if the procedure isn’t covered by medical insurance, that is), because there would be no interest or fees involved.

If you don’t have savings to tap to pay cash for your crowns, you could use an existing credit card with a credit line that would more than cover the cost. Pay off the card fast, and you will be in fine financial shape. An $1,800 balance chopped up into four payments of $467 will cost an extra $64 or so in interest charges.

Don’t have an existing credit card, but have good credit? You can apply for a 0 percent APR card with a long period with that promotional interest rate.  Just be sure you pay off the balance before that introductory period expires.

If your credit isn’t that great or if you are already overextended on credit cards, maybe a kindly relative will offer a personal loan. Just be sure to treat the loan as seriously as you would a loan with a bank. With a family loan, your credit rating won’t be affected if you don’t fulfill your end of the bargain, but your relationship with your relative might be ruined if you don’t repay in a timely and agreed-upon fashion.

If CareCredit seems as if it’s the best (or only) option, that’s OK. Here is what you need to know about how CareCredit works:

CareCredit offers financing options specifically for elective and essential medical procedures to qualified individuals. Get it and you can satisfy that painful dentist bill over time, with no additional costs. Depending on the plan, you might have six to 24 months to repay that $1,800 before interest is added to your bill.

But first be sure you can qualify. If your credit scores are poor and you don’t have the means to make your payments, you may not be approved. And as with any credit card, applying will result in a hard pull on your credit report, which can negatively impact your credit scores temporarily.

With CareCredit, it’s also important to be sure you can and will pay the entire amount before the interest-free period ends. If you don’t pay off the bill before the deadline, the accumulated interest will be charged from the date you received the loan and then added to the balance.

On your credit reports, your CareCredit account would be listed similar to a credit card account. The outstanding balance will appear in the trade lines section of your credit report from the date it was granted, and your payment activity will be factored in your credit scores. By sending your payments prior to the due date every month and quickly erasing the obligation, your credit scores will be fine. Don’t make your payments, and your credit scores will decline.

If you are approved for CareCredit financing, be proactive in your management of the account. Over the years, there have been some complaints that payments were erroneously posted late, so monitor your statements carefully. Call the company immediately if you notice any problems, so those issues can be resolved quickly.

Whatever you do, I urge you not to delay dental work. The longer you wait, the more painful and expensive your dental care will become. When I was a credit counselor, I once helped a relatively young man who had lost most of his teeth because he had not seen a dentist for many years. It was a terribly sad situation, affecting not only his physical and emotional health, but also his employment opportunities.

Now go get those crowns!

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