Consolidate with Discover?

taxi818 · ‎07-01-2015

well yesterday. I got an offer from discover for 0% apr for 12 months if I bt. But 3% fee is charge. My question. I still have 3 months left on my initial offer of 14 months 0% on purchases.

Howeer the bt offer states. New purchases will be charged interest. Does this make my 14 month no good. .?

Pif so I'm fine with it if I get another year to add balances to 1 card also. Will amex be upset if I bt my balance? High interest with them.

Anonymous · ‎07-01-2015

your 0% for 12 months should be a separate offer than the initial 14 month offer. it shouldn't replace it.

also amex would rather you BT your balance than let it roll over on their card. save yourself the money

steel_string · ‎07-01-2015

It's just saying that'll you'll lose your grace period. It's a nonissue as long as you have zero interest on new purchases. Many other issuers do the same.

Chase Sapphire Preferred ($24.005k), Fidelity VS ($17K), United MileagePlus Explorer ($17K), Chase Freedom ($15K), Chase Freedom Unlimited ($15K), AmEx Blue Cash ($12.5K), IHG One Rewards Premier ($6.1K), US Bank Cash+ ($5K)

UncleB · ‎07-01-2015

I'm with everybody else, I would go for it.

One thing to check on is once your current promo runs out and if you do take advantage of the 0% BT, how will any payments be credited. One of my cards I have a promo on right now has a similar deal, but there is a 'catch'... they put the entire amount of any payment toward the 'interest free' portion of the balance first, which means during my promo if I do a so much as a $1 transaction that acrues interest, there is no way to pay off that $1 without paying the BT part in full as well. It's not really 'underhanded', but for folks that don't read the 'fine print' it can be irritating to find out that while the promo is 'legit', if they aren't careful they will end up paying interest anyway.

Just my 2¢

taxi818 · ‎07-01-2015

That's confusing. Current promo. Ends in November. 14 months 0% apr. But if I accept the promo of bt. It's says new purchases will accrue interest. Is this after my 14 months. I will call them. And explain thing.

UncleB · ‎07-01-2015

@taxi818 wrote:
That's confusing. Current promo. Ends in November. 14 months 0% apr. But if I accept the promo of bt. It's says new purchases will accrue interest. Is this after my 14 months. I will call them. And explain thing.

I agree that calling them is the best thing; what you're describing sounds almost exactly like what I've got.

Here's what you want to do for sure; before you do that BT, make sure the card is PIF. Otherwise, if you still owe a balance once your BT posts to your account, every payment will go towards paying it (the BT) off first. This would not be problematic until November, when your 14 month promo runs out. At that point, interest will start accruing on the non-BT portion, but all of your payments will (likely) be posted against the BT portion only, meaning you'll be paying interest on the other balance until the BT is paid in full. (I said 'likely', since that's how it normally works. Possibly Discover is different; but I would absolutely GRILL them on it if they say they are different, since unless you have lots of cash laying around it can be difficult to correct).

Edited to add: You'll also not want to use the card for new purchases during the time you're paying off the BT, since making any new purchases will have the same effect as not PIF your balance before the BT... you'll be stuck paying interest until the BT is paid off.

taxi818 · ‎07-01-2015

Ok I called. You are correct. I have 3 sub catagories.

Purchases. End oct 25th.

3bt's. End July 2016.

So. If I pay infull $1900 by oct 25th. No interest. And I still have until next July. No interest on bts. All my payments over minimum goes to BT. But since my balance is 3k. She said I need to pay 480 per month to avoid any interest. My plan. Pay 240 a month for a year. And don't use card again. Then boom all done. Thanks all to help me understand. I save the cash from the balance with amex.

UncleB · ‎07-01-2015

@taxi818 wrote:
Ok I called. You are correct. I have 3 sub catagories.
Purchases. End oct 25th.
3bt's. End July 2016.
So. If I pay infull $1900 by oct 25th. No interest. And I still have until next July. No interest on bts. All my payments over minimum goes to BT. But since my balance is 3k. She said I need to pay 480 per month to avoid any interest. My plan. Pay 240 a month for a year. And don't use card again. Then boom all done. Thanks all to help me understand. I save the cash from the balance with amex.

Sounds like a good plan!

When it comes to the credit card promos, knowledge truly is power. They all have little 'hoops' they make us jump through, but as long as we know how to 'work it' they can be a fantastic financial tool!

syeb · ‎07-01-2015

@UncleB wrote:
I'm with everybody else, I would go for it.

One thing to check on is once your current promo runs out and if you do take advantage of the 0% BT, how will any payments be credited. One of my cards I have a promo on right now has a similar deal, but there is a 'catch'... they put the entire amount of any payment toward the 'interest free' portion of the balance first, which means during my promo if I do a so much as a $1 transaction that acrues interest, there is no way to pay off that $1 without paying the BT part in full as well. It's not really 'underhanded', but for folks that don't read the 'fine print' it can be irritating to find out that while the promo is 'legit', if they aren't careful they will end up paying interest anyway.

Just my 2¢

I believe that according the the law, they can apply only the minimum payment to the lower APR balances and anything above that MUST be applied to the highest APR balance first.

However you are right in a different way in that you will lose the grace period on new purchases and so will pay interest on any new purchases even if you pay the entire NEW purchase balance in full.

Section 104(b)(1) of the Credit CARD Act of 2009.

‘‘(b) APPLICATION OF PAYMENTS.—
‘(1) IN GENERAL.—Upon receipt of a payment from a cardholder, the card issuer shall apply amounts in excess of the
minimum payment amount first to the card balance bearing the highest rate of interest, and then to each successive balance
bearing the next highest rate of interest, until the payment is exhausted."

UncleB · ‎07-01-2015

@syeb wrote:
@UncleB wrote:
I'm with everybody else, I would go for it.

One thing to check on is once your current promo runs out and if you do take advantage of the 0% BT, how will any payments be credited. One of my cards I have a promo on right now has a similar deal, but there is a 'catch'... they put the entire amount of any payment toward the 'interest free' portion of the balance first, which means during my promo if I do a so much as a $1 transaction that acrues interest, there is no way to pay off that $1 without paying the BT part in full as well. It's not really 'underhanded', but for folks that don't read the 'fine print' it can be irritating to find out that while the promo is 'legit', if they aren't careful they will end up paying interest anyway.

Just my 2¢
I believe that according the the law, they can apply only the minimum payment to the lower APR balances and anything above that MUST be applied to the highest APR balance first.

However you are right in a different way in that you will lose the grace period on new purchases and so will pay interest on any new purchases even if you pay the entire NEW purchase balance in full.

Section 104(b)(1) of the Credit CARD Act of 2009.

‘‘(b) APPLICATION OF PAYMENTS.—
‘(1) IN GENERAL.—Upon receipt of a payment from a cardholder, the card issuer shall apply amounts in excess of the
minimum payment amount first to the card balance bearing the highest rate of interest, and then to each successive balance
bearing the next highest rate of interest, until the payment is exhausted."

I know that's the way they handle higher vs. lower rates, but they might (?) get around it by giving promos with -no- interest rate (0%), since the actual language only refers to higher vs. lower, not explicitly mentioning the absence of interest altogether. Yeah, I know it seems like a stretch, but I've seen worse contortions of common sense language. Personally I much, much prefer your understanding, but I'm not willing to 'poke the bear' to find out the intricacies of the bank's language vs. the way common sense says it should be.

What I described earlier to the OP is how the 'plain English' description read on my recent promo; I also mentioned to the OP that his deal with Discover could vary, and that he needed to contact them for clarification. Since Discover is considered one of the more 'customer focused' credit card companies, I would actually be disappointed if they didn't do a little more than the bare minimum required by law.

From past experience (got burned a while back) if there is a question in the language it usually works out in the bank's favor, and it's nearly impossible to get them to budge once the transaction is done.