Maxed out Credit Card Balance Transfers
Author: MadDuck
Posted: Tue Oct 11, 2005 5:42 pm
Post subject: Maxed out on 0% balance transfers!
I've just completed 0% BT offers on 5 credit cards at once, now using 100% of my available credit!
I wasn't in debt, I just wanted the free (for a while) money. I'm now wondering-- what are the CC companies going to do? All offers were done using balance transfer checks deposited into my bank, so companies didn't know I was maxing myself out everywhere.
What could happen from here?
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Author: JaneiR36
Posted: Tue Oct 11, 2005 5:57 pm
Post subject:
FICO score drops a few points or plummets, as the case may be. But this is just about a non-issue if you're not planning on doing any big applications soon (mortgage, etc). Your BT terms should be safe until they expire, but CC companies in the future may use this high usage as an excuse to raise your purchase APRs. You may also have a harder time getting more of these offers approved in the future, unless of course you pay it off periodically!... or pay it down significantly just before you apply for more credit
Author: StephanB
Posted: Tue Oct 11, 2005 6:14 pm
Post subject:
Don't forget to make the monthly payments on this BT ..
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Author: Ralph
Posted: Tue Oct 11, 2005 6:30 pm
Post subject: Maxed out Credit Card Balance Transfers
MadDuck,
I have read posts by other forum members saying that they had charged their cards up to 60,000$ to put the money in a saving account or for other purposes without any adverse consequence. Well my experience was different. I did what you just did a couple of years ago because I needed the cash urgently. Overnight, I transferred around 70-75% of my available credit to my checking account. I had around 100k in available credit and didn't have any credit card debt. I thought that by not maxing out my cards completely I would be ok. However a couple of months later, credit card companies started decreasing my lines, increasing interest rates and some closed my accounts. I had an MBNA Platinum Plus card that got closed. Before closing my account an MBNA financial advisor called me to inquire about the reason why my debt raised over a matter of days to 70,000$, all credit cards included. She said almost verbatim "credit card companies get nervous when things like this happen, they get worried that you might not be able to pay back... everybody is watching your credit report you know". MBNA was first to close my account (it was my oldest account, go figure), others followed with closures, hiking up interests and decreasing lines. I guess when 1 creditor lose confidence in you, others follow (they too see that your account was closed).
My advice: others may tell you differently, but based on my personal experience I would advise you to pay back the balances as soon as possible to avoid running into a similar situation.
Also you said that you transferred 100% of the balances. Are there fees for balance transfers? If so, be careful: in that case some banks might charge you the fee to you current cycle AND will add an overdraft fee (transfer fee + 100% used credit= overdraft).
I know it does not apply to you since your balances are 0% but if the transfers were not 0%, crapy companies might even add your finances charges to your credit limit at the end of your cycle and charge you an overdraft because you passed your limits.
Author: JaneiR36
Posted: Tue Oct 11, 2005 6:38 pm
Post subject:
It's probably different when you do it routinely and for sport, than when you do it as a result of trouble and desperation... I'm pretty sure that paying the money back every so often will also show that you're not interested in keeping the money, but rather moving it around so they have nothing to worry about.
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Posted: Tue Oct 11, 2005 5:42 pm
Post subject: Maxed out on 0% balance transfers!
I've just completed 0% BT offers on 5 credit cards at once, now using 100% of my available credit!
I wasn't in debt, I just wanted the free (for a while) money. I'm now wondering-- what are the CC companies going to do? All offers were done using balance transfer checks deposited into my bank, so companies didn't know I was maxing myself out everywhere.
What could happen from here?
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Author: JaneiR36
Posted: Tue Oct 11, 2005 5:57 pm
Post subject:
FICO score drops a few points or plummets, as the case may be. But this is just about a non-issue if you're not planning on doing any big applications soon (mortgage, etc). Your BT terms should be safe until they expire, but CC companies in the future may use this high usage as an excuse to raise your purchase APRs. You may also have a harder time getting more of these offers approved in the future, unless of course you pay it off periodically!... or pay it down significantly just before you apply for more credit
Author: StephanB
Posted: Tue Oct 11, 2005 6:14 pm
Post subject:
Don't forget to make the monthly payments on this BT ..
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Author: Ralph
Posted: Tue Oct 11, 2005 6:30 pm
Post subject: Maxed out Credit Card Balance Transfers
MadDuck,
I have read posts by other forum members saying that they had charged their cards up to 60,000$ to put the money in a saving account or for other purposes without any adverse consequence. Well my experience was different. I did what you just did a couple of years ago because I needed the cash urgently. Overnight, I transferred around 70-75% of my available credit to my checking account. I had around 100k in available credit and didn't have any credit card debt. I thought that by not maxing out my cards completely I would be ok. However a couple of months later, credit card companies started decreasing my lines, increasing interest rates and some closed my accounts. I had an MBNA Platinum Plus card that got closed. Before closing my account an MBNA financial advisor called me to inquire about the reason why my debt raised over a matter of days to 70,000$, all credit cards included. She said almost verbatim "credit card companies get nervous when things like this happen, they get worried that you might not be able to pay back... everybody is watching your credit report you know". MBNA was first to close my account (it was my oldest account, go figure), others followed with closures, hiking up interests and decreasing lines. I guess when 1 creditor lose confidence in you, others follow (they too see that your account was closed).
My advice: others may tell you differently, but based on my personal experience I would advise you to pay back the balances as soon as possible to avoid running into a similar situation.
Also you said that you transferred 100% of the balances. Are there fees for balance transfers? If so, be careful: in that case some banks might charge you the fee to you current cycle AND will add an overdraft fee (transfer fee + 100% used credit= overdraft).
I know it does not apply to you since your balances are 0% but if the transfers were not 0%, crapy companies might even add your finances charges to your credit limit at the end of your cycle and charge you an overdraft because you passed your limits.
Author: JaneiR36
Posted: Tue Oct 11, 2005 6:38 pm
Post subject:
It's probably different when you do it routinely and for sport, than when you do it as a result of trouble and desperation... I'm pretty sure that paying the money back every so often will also show that you're not interested in keeping the money, but rather moving it around so they have nothing to worry about.
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
posted by CardRatings.com at 5:13 PM
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