tag:blogger.com,1999:blog-5465015914589377788.post5605929662779680503..comments2024-03-20T09:32:16.592-04:00Comments on Michael James on Money: Credit Cards with 0% Balance Transfer for LifeMichael Jameshttp://www.blogger.com/profile/10362529610470788243noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-5465015914589377788.post-47599186875055169652009-11-18T13:10:08.863-05:002009-11-18T13:10:08.863-05:00MarliO: You're right that failure to pay on t...MarliO: You're right that failure to pay on time even once is another way that credit card companies can catch people and jack up their interest rates. I hope your balance transfer works out for you. It sounds like you're being appropriately cautious. I hadn't heard of making the minimum payment twice, but it's a good idea. I've heard of people having trouble because a payment gets delayed or lost. You'd have to be extremely unlucky to lose out this way.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-79043955984623320752009-11-18T11:54:02.850-05:002009-11-18T11:54:02.850-05:00There's a third catch, which is that if the ca...There's a third catch, which is that if the card owner is late on a single payment, the interest rate shoots up to the default rate. <br /><br />In my case, I transferred almost $15,000 of higher interest debt to a card with a promotional rate of 1.99% for life. I make the minimum payment TWICE per month, just to be sure that I don't miss a payment, which would result in a new interest rate of 19.99% (i.e. more than 10x the promotional rate). However, as long as I keep up the payments, this approach is saving me hundreds of dollars in interest every month, while I wipe out the last vestiges of higher=interest debt.MarliOnoreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-68977088789461550492009-11-18T00:11:43.035-05:002009-11-18T00:11:43.035-05:00Gene: I think you're talking about this blog ...Gene: I think you're talking about <a href="http://michaeljamesmoney.blogspot.com/2008/05/credit-card-arbitrage_22.html" rel="nofollow">this blog entry</a>, where I describe Madison's elaborate credit card arbitrage scheme. I haven't seen her post anything on this lately. Either she isn't running the scheme any more or she doesn't think it will interest her readers. You may be right about it getting difficult to find 0% balance transfer offers with the same nice terms.<br /><br />I don't carry balances either. I don't know if you can "transfer" a nonexistent balance, but it wouldn't be too hard to simulate. I wouldn't recommend this, but one could get a card, max it out with cash withdrawals, pay the interest charges for the first month, and then transfer the balance elsewhere.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-49850800287108560372009-11-17T23:52:28.680-05:002009-11-17T23:52:28.680-05:00I recall reading about a scheme on another blog wh...I recall reading about a scheme on another blog whereby a savvy borrower does a balance transfer to a 0% card for the duration of the promotional period, then moves the balance to a fresh 0% card, rinses, and repeats, etc.<br /><br />You detail the potential pitfall in your post of not using the new card for fresh purchases.<br /><br />The other problems would be that 1) you would not be able to find a replacement 0% offer at some point, and 2) Opening many credit cards could affect one's credit report/score.<br /><br />As long as someone keeps enough money on hand to pay off the balance in full if required and also doesn't need to borrow money again in the future (owns own house and is financially independent), it's fairly low risk.<br /><br />I've always wondered if you can transfer a balance from another card if you don't have a balance on the card to be transfered from. I never carry a balance, so have never taken advantage of a transfer offer.genehttps://www.blogger.com/profile/05608927986297939720noreply@blogger.com