I take your point about the 50 cap and have in fact found a couple of cards with no balance transfer charge at all and so I have changed my tack a little.
However, how on earth do you crank up the initial balance of 48 000 without incurring hefty monthly interest charges (currently ~15.9% APR) bearing in mind that there is a minimum repayment on all balances (5% of 48 000 is 2400 p.m.)
Further I note that repayments are applied according to a hierarchy of liabilities on the account. Top of that list are fees and charges, next comes interest, then comes balance transfers and cash withdrawals and purchases come right at the bottom.
==================== Simple, dont use the card for anything other than balance xfers, obviously.
Obviously except that this doesn't tell us how he got £48000 out of his credit card account into his bank account in the first place without incurring excessive interest charges.
It's not like any credit card company is going to lend you £48000 cash interest free.
They will only waive interest upon balances transferred from an account held with another company as an inducement to move your account to them.
Obviously except that this doesn't tell us how he got 48000 out of his credit card account into his bank account in the first place without incurring excessive interest charges.
It's not like any credit card company is going to lend you 48000 cash interest free.
They will only waive interest upon balances transferred from an account held with another company as an inducement to move your account to them.
=======================
I cant recall the erlier post but bear in mind it might not be *one* credit card company, I have a friend who has two credit cards each 0%, each with about 10k on.
Do what I did (I have 10k now but 48K is only 5x more and I did have more at one point), just do a credit xfer to pay off your "real" credit card and do it every month. I was doing this this until a few months back but the new credit card I got only allowed a free xfer for the first 6 weeks. Before that I was doing it every month for 6 or 7 months on each card over 2 or so years, all for free, no charges. Depending upon whether he is well off, or his company expenses flow through it, could be done fairly easily. I'm sure if my company expenses were done this way I could easily add another 5k a year to it, and I dont travel that much. A couple of internal air fares, 5 or 6 hotel nights, could easily amount to a grand a month.
You can put as much money through as many cards as you like. The principle remains exactly the same.
There are but three possible transactions possible on a credit card account, repayment, cash withdrawal and card purchase. In relation to the latter what you end up with is goods and services but nothing you can put into a bank. You can of course withdraw cash at an ATM and put this straight into a bank account. However, if you do you will pay ~2% handling charge (the equivalent of ~6 months interest paid by a bank account.)
The rules concerning the first mean that you will pay back 5% of your balance regardless of the way you borrowed it every month whether it has been transferred or not. The hierarchy of payments means that anything you pay will come first of all off your 0% balance. It goes without saying that if you buy or borrow on your new card, not only will the new money incur the full whack of ~15.9% APR but the size of the minimum payment will go up so that your 0% balance gets paid off even quicker.
Remember we are talking of taking free credit, putting it in a bank account and trousering the interest, I'm still not convinced that a 0% credit balance transfer is an instrument that facilitates this.
hmmmm, a plan might be not to buy on borrrow on that card then! Thats I what I do with my current card which I use for this, and what I did with the ones that preceeded it, and were used for the same purpose. The only 'spending' on them was via balance xfers, the only payments, the minimum.
Lets say in one month I spend 2000, all on credit card A, 2000 which I can afford. I then pay off CC A via a transfer from CC B, which is 0% interest. I now have 2000 in my bank, which otherwise would have been used to pay CC A. Repeat each month. I really dont see what so difficult to understand about that.
In effect you use the 0% interest to delay debt repayment of debts you are in a position to meet anyway but by leaving the money in your account a few months longer you pocket extra interest.
I can assure you it is. I've done it many times and currently have over
20,000 in a high interest account earning me a bit of extra cash each month.
What you don't seem to realise is that you don't have to transfer a balance from another credit card - many companies allow you to transfer your "overdraft" balance. They pay the cash straight into your current account, whereupon you swiftly transfer it to a high interest account, as the overdraft doesn't actually exist of course. The card companies don't seem to care what you actually want the balance transfer for, presumably relying on enough people being daft enough to use the card for other purchases.
And because interest free transfers are a cost to the CC they are having to think up new ways to (impose/increase) charges to customers to make up this shortfull.
Quite why it is that the majority 'good' customers should fund the peverse borrowing techniques of a few leaches is beyond me. Personally, I think interest free credit transfers should be banned. If they don't wash their own face they shouldn't be in the system.
Well is there any credit card company that will lend me £48 000 cash that I can place straight into my bank account. If you know of one please tell me and I will be very much in your debt.
Well what else can I do with my credit card besides buy things with it, draw cash from an appropriate bank or ATM and pay my bill at the end of the month.
Just a minute. I would suggest that I was amongst the first holders of a credit card (Barclaycard) in this country. It must have been back in
1964 or 5 when I filled in an application form I cut out of a newspaper. I have held a Barclaycard ever since.
I don't intend this last statement to be an endorsement of Barclaycard as such it's just that in view of the use I make of my credit card i.e. as a facility I have never seen the need to change. I live according to the adage "If it ain't broke, why fix it?"
I have never paid a penny interest to a credit card company in my life so interest rates have never concerned me.
However, I do take an interest in money. I do seek serious investment opportunities. I do dabble in shares and bonds. I don't make fortunes but I do outperform bank and other investment intruments which nonetheless I still do use these simply for the peace of mind afforded by the high level of security they provide.
I had heard of this particular scheme before and when people here started talking about it I decided to look further into it. I'm sorry if that upset you but there we are.
Having now looked into it, I find that what it all amounts to is an old scheme in an updated guise. They do say there is nothing new under the sun. What it amounts to is delayed debt repayment. Back in the 70's and
80's when interest rates were much higher than they are now, Folk used to or used to talk of delaying the payment of their regular bills for as long as possible. For instance utility bills would be left until the "Final reminder" stage, council rates would be left until you were threatened with court action and so on. In the meantime the money was earning good interst in the bank and, incidentally the debt was being eroded by then rampant inflation.
The advent of the 0% balance transfer, possible only because of low interest rates, has, as I see it, simply afforded facility to extend this principle across a much wider range of spending. As I say there is nothing fundamentally new in this. In fact large companies who have real money to spend have been doing this for years. They have been criticised for it since the practice restricts cash flow of suppliers who are usually smaller companies dependent upon the larger's custom.
At a personal level I see nothing wrong per se in what you do. There is no way that customers are going to drive credit card companies out of business. The purpose of the offer is that as any other offer, to capture market share. The core business of any credit card company is money passing through accounts earning good commissions. The extent to which these offers enhance that (or prevent leakage to other companies) measures their success. If ever they are found expensive you and I both know they will disappear.
What I would caution against is the very notion of delaying payment of that which you owe might, in some create a confusion between assets and liabilities. There is no way a debt can ever be an asset. The interest earned in those savings accounts may well belong to the holder, the capital ipso facto belongs to somebody else. Let's hope the bulk of holders know and respect this fact otherwise they are in increasing lumber.
I don't think CC companies have put charges/APR's up since the 0% deals started coming in - they were simply making such big profits from the mugs who left big outstanding balances on their cards, that they realised it would be a good idea to try to grab such mugs from other credit card companies - so they offer them an interest free period if they transfer their balance. They know most will stay at least for a while after the 0% ends, or use their card for spending, and so pay them high APR interest.
Because that's the way credit card companies and banks choose to do business. They do it because it works, and the 'majority of good customers' who make them the money to subsidise the 'leaches' are the mugs who have been paying 15% APR on a credit card for ages.
Well, the more people who take the piss by 'stoozing', the more likely this is to happen. It's happening in the mortgage market now - a few years ago nearly all lenders had standard rates about 2% over the BOE base rate, with big short term discounts - so anyone with any sense simply switched their mortgage every few years to a new deal. Now there are several lifetime rates which are very reasonable - rates which 5 years ago you could only get on a short term basis.
Well is there any credit card company that will lend me 48 000 cash that I can place straight into my bank account. If you know of one please tell me and I will be very much in your debt.
You really should google this group for this topic as its been done to death.
Yes there are companies that will lend you money you can put straight in your bank account. The amount will depend on the credit limit you have.
Egg is one. You set it up and can do a balance transfer direct to your current account. MBNA is another, although they have recently taken to charging fees on balance transfers. They may waive these in the initial period, I don't know, you really need to check for yourself. However your whole presence in this thread has consisted of making wild statements that get corrected and you seem to avoid the information offered and go on to give another reason for why it will not work. Even if you have a card that doesn't allow balance transfers to a bank account, you can transfer to Egg first and then to your bank account.
It can and does work for many people, but you need to keep up-to-date with the changes in rules for different cards, such as the changing state of the market with balance transfer fees. You also need to follow when your interest free period is up. They don't write and tell you, but will just begin to add interest.
Right! Here are the benefits and features of the Egg card.
formatting link
Now you point to me the benefit that allows me to draw interest free
*cash* from here and place it in a bank account.
I'm really not going to do all your homework for you. You have also changed the question. The question was whether any credit card company would lend you cash that you can place directly in your bank account. It now looks as though Egg is charging new customers 50 for the pleasure. I did say you needed to keep up with changing charges in the regulations.
Look at the section about half-ways down that says 'Convenient balance transfers' The bit about overdrafts means you can transfer it to a current account. You just ask for a transfer and give your current account number.
and yes I have tried it, not to save it, but when I needed money quickly and was going to lose interest by withdrawing it from my savings account without giving a month's notice.
I have a 10,000 limit with Egg and am during my 5 month interest free anniversary period. I can transfer 95% of that or 9500 to my current account. As I applied before 1/5/05 I wouldn't be charged a fee. My wife is a non-taxpayer, so putting it in her name at 4% would give her about 150 tax-free over the 5 months. Then as long as she gives it back to me and I pay it off on time it wouldn't cost me anything.
Weren't you given a link to a website previously with a full explanation?
25 quid for paying late,
25 quid for a bounced payment
25 quid for going over your credit limit
25 quid for something else.
5 years ago these charges only existed on the marginal providers, now they all have them.
And then there is changing the way interest is calculated so that it is back-dated to date of purchase etc (see this month's Which for the different tricks)
I also hear rumours that some providers are thinking of re-introducing fees for cards as they can't make the numbers stack up any more.
I realise why they thought it was a good idea, but it only works until everyone does it. Then when you get to the point that you lose as many customers as you gain it becomes a drain on the bottom line. I realise that this isn't necessarily a reliable source but I've seen some TV comentators comment that it has reached this point.
I don't agree. The interest is just the icing on the cake. The cost to the CC company of running my card is paid for by the 2-3% that they charge the reatailer - until they started giving that back as cashback!
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