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Beat them at their own game?
Old 10-23-2006, 09:52 PM   #1
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Beat them at their own game?

So today I get credit card offer #1,000,001, and it contains a check that I can write for $30,000 and deposit anywhere. If I bite, they say they will charge me a flat $75 fee and an interest rate of 0.99% until March. I can deposit this in a money market and earn, say, 5%. If I pay back the full $30,000 by March, I figure I can earn $400 net interest, less $75, less income tax.

Would you say it's worth it?

If I am late on a payment, they will tear me a new orifice, but I should be able to program my bill-paying software to guarantee prompt re-payment. 8) Did I overlook something?
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Re: Beat them at their own game?
Old 10-23-2006, 09:56 PM   #2
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Re: Beat them at their own game?

Quote:
Originally Posted by Lifeisgood
So today I get credit card offer #1,000,001, and it contains a check that I can write for $30,000 and deposit anywhere. If I bite, they say they will charge me a flat $75 fee and an interest rate of 0.99% until March. I can deposit this in a money market and earn, say, 5%. If I pay back the full $30,000 by March, I figure I can earn $400 net interest, less $75, less income tax.

Would you say it's worth it?

If I am late on a payment, they will tear me a new orifice, but I should be able to program my bill-paying software to guarantee prompt re-payment. 8) Did I overlook something?
No, lots of people seem to do it. There's a special name for it and perhaps a thread
or two elsewhere here. Most people seem to be able to swing it where they're paying
zero interest and no fees though. I can't believe the card companies let you get
away with this (but I guess their greed and all the stupid people make them keep
sending out these offfers). I'm pretty tempted myself.


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Re: Beat them at their own game?
Old 10-23-2006, 10:03 PM   #3
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Re: Beat them at their own game?

Quote:
Originally Posted by Lifeisgood
Would you say it's worth it?
Yes, but not for the few bucks you can make (less fees & taxes) between now and March. Do it because there is a good chance you can transfer your balance to another zero/teaser rate card in February and continue the deal well into next year...or beyond.

Quote:
Originally Posted by Lifeisgood
Did I overlook something?
Don't think so.

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Re: Beat them at their own game?
Old 10-23-2006, 10:29 PM   #4
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Re: Beat them at their own game?

Quote:
Originally Posted by Lifeisgood
If I bite, they say they will charge me a flat $75 fee and an interest rate of 0.99% until March.
0.99% flat, 0.99% per annum,... or 0.99% per month? It's going to take a while to read all that 4-point print.

A 5% APY money market on $30K for Nov-Dec-Jan-Feb grosses you $500, and as you point out there's the 0.99% something minus $75 and minus your income taxes. If you walk away with $400, what hourly rate does that give you for your efforts?

Ah, but this $30K could be the start of something bigger... much bigger!
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Re: Beat them at their own game?
Old 10-24-2006, 05:35 AM   #5
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Re: Beat them at their own game?

I am not going to go back and check this, but I know I am into 5 figures
(INCOME) since they started doing this (small disclaimer...........that's gross
and I do pay a teaser rate above -0-% on a couple of cards). I pay no fed. taxes on this (annual income too low) and right now it's about the only personal
income I have coming in. Sooooooooooooo, for me it looks like the biggest
no-brainer ever. Free money! Whoo hoo!!

JG
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Re: Beat them at their own game?
Old 10-24-2006, 06:35 AM   #6
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Re: Beat them at their own game?

Don't most if not all of the CC also have a minimum amount you must pay per month (1-3%); I believe this requirement was passed by Congress last year. Correct me if I'm wrong.
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Re: Beat them at their own game?
Old 10-24-2006, 08:04 AM   #7
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Re: Beat them at their own game?

Quote:
Originally Posted by ferco
Don't most if not all of the CC also have a minimum amount you must pay per month (1-3%); I believe this requirement was passed by Congress last year. Correct me if I'm wrong.
Yes, they probably have this requirement down in the 4-point type. But that should be OK as I will just be giving them their money back. Lowers the effective return a smidge.
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Re: Beat them at their own game?
Old 10-24-2006, 08:50 AM   #8
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Re: Beat them at their own game?

It is possible to make money at this, but it takes a lot of reading, juggling, and remembering. One slip-up and you've wiped out months of carefully executed "strategery." It's not worth it to me-too much hassle and downside. Overall, if I enjoyed reading fine print and complying with arcane requirements I'd just get a job as a tax preparer and get paid better per hour.
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Re: Beat them at their own game?
Old 10-24-2006, 10:40 AM   #9
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Re: Beat them at their own game?

I'm doing it right now with a 0% card. It makes me uneasy. I fear a random "universal default" that will sky-rocket the rate.
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Re: Beat them at their own game?
Old 10-24-2006, 11:36 AM   #10
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Re: Beat them at their own game?

I fell victim to a similar 0% offer from Chase, although it was a purchase offer, not balance transfer. Made a $10K purchase, and figured I'd pay the minimum until the offer was up, then pay if off from my savings. They hosed me...

I knew going in, that one slip up would cause the interest rate to skyrocket. So when my first statement arrived, I scheduled an automatic recurring payment for the minimum amount, to arrive 10 days before the due date. Since this was the only transaction on the card, I didn't bother reading the online statements every month - just downloaded the transactions into Quicken, from which I could verify the payment had arrived.

3 months in, my Quicken download showed a late fee and an interest charge in addition to my payment received. Turns out, they changed the due date on me - earlier, of course. I wasn't paying attention to the Chase statements - that's why I set up the autopay. Payment arrived two days late, and the interest shot up to 19%. I called up and bitched, and they backed out the late fee, and reverted me to the 0% plan. I asked what the earliest possible day of the month would be, that a payment would ever be due. Based on their answer, I rescheduled the autopay.

All was good for another few months. Then, I noticed another late fee/interest charge on my Quicken downloaded transactions. Called them up again...this time, they raised the minimum payment due, and even though my balance was decreasing, the amount I had been paying for the previous 6 months no longer covered the minimum. My payment had arrived on time, but was $10 short.

Fuggem'...paid off the card, and cut it up. From my point of view, they not only have a gazillion fine print obstacles you must deal with, they'll also try to trip you up after the fact. Life's too short to deal with saving a few bucks from these crooks...never again.
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Re: Beat them at their own game?
Old 10-24-2006, 12:04 PM   #11
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Re: Beat them at their own game?

Gotta Go--that's even trickier than I'd imagined they would be. Another common "gotcha" is 12 month interest free deals. Pay it off a few days prior to the 12th statement and you're still hosed if the fine print starts the clock on the date of purchase.
But, I guess some folks do it and don't get burned.
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Re: Beat them at their own game?
Old 10-24-2006, 04:42 PM   #12
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Re: Beat them at their own game?

This is doable and its not that hard. I have one with Chase and have not had problems so far. I use the autopay and schedule payments just a few days before due. I try to examine the fine print closely, and I review the paper statements they send. One of my rules is to not use the card for any other purchases. Another rule is not to bother if the teaser term is less than 12 months give or take. So I would say this deal is not worth it for such a "short" term, given the hassle factor.........then again, they never offered me 30k and I do have a weakness for free money.
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Re: Beat them at their own game?
Old 10-24-2006, 05:04 PM   #13
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Re: Beat them at their own game?

Wow, Gotta Go. They're good!
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Re: Beat them at their own game?
Old 10-24-2006, 05:22 PM   #14
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Re: Beat them at their own game?

Quote:
Originally Posted by Lifeisgood
Wow, Gotta Go. They're good!
Heh...it almost falls into the category of "so sneaky, it's funny".

Probably would be, if it happened to someone else...

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Re: Beat them at their own game?
Old 10-24-2006, 05:25 PM   #15
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Re: Beat them at their own game?

Op, you should check out fat wallet finance on this stuff...lots of folks there have stories of playing these games....
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