08-25-2009 09:08 PM
Chase has pissed me off by raising my rate from 7.24% to 14.24% effective October.
I had been carrying a balance while paying off some balances that were at 9.99% and 9.24% on other cards.
I've strained and paid off the balance on the Chase card as of today. I have these BT checks for 0% for 9 months or 2.99% for 18 months. Each has a 3% fee with a $249 max.
Tomorrow I'm going to write one for $19,000 against my $20,000 CL and deposit it in my checking account. That will give me a $249 fee, which works out to 1.31%. I will then use the money to pay off two 1 year 0% interest BTs that expired in the last two weeks. If I paid each one through regular BTs, I would pay much higher BT fee.
Any bets on what happens?
08-25-2009 09:15 PM
I bet your score will be dropped.
08-25-2009 09:31 PM
08-26-2009 06:28 AM - edited 08-26-2009 06:30 AM
I'm thinking that my score will go down for the 95% util on the Chase card. However, it is reporting $4600 or 25% util now. The two cards that will be paid off were reporting 80% and 27%. Those will now go to zero util. I'm hoping the big increase on the Chase doesn't get reported too much before the decrease for BMW and CapOne.
My personal Check account has $300 in it. I don't think the bank will give me much choice about waiting 5 days for Chase to approve the check. Even then, I will wait until Chase shows the transaction before paying the other two online.
I do know I'm looking for trouble. I do think it is an interesting experiment and will give others good information. I have done lots of BT, but never this high a util in this environment.
The debt on CC is due to a combination of factors: divorce, ex wife that trashed my business, current business environment, CLs cut by other vendors. I'm gradually paying it off. I paid the last month statement from Chase of $4,600 off in approx 30 days, which was a major strain. I ending up having the last of the money just as the statment cut so that I knew I was paying the entire balance. I wanted nothing remaining (like $20 in interest) that they could charge me 14.24% interest on until the end.
The entire idea is to not pay off the $19,249 in 9 months but to pay the minimum payment. This will maximize the amount at 0% interest while I pay off the other balances at higher interest rates. The 18 months at 2.99% seems like a better deal but if Chase changes my minimum from 2% to 5% of the balance then the 9 months 0% interest seems better. I have a spreadsheet keeping track of all the balances and interest rates. I'm gradually digging out and paying an average interest rate about 4%.
08-26-2009 08:17 AM
Greb: you got to do what you got to do. Though I am not in your type of financial mess so I might not understand the pain.... But i would do what you want to do.
08-26-2009 08:41 AM
I will advice that you perform the BT with some intelligence. $19,000 check will raise a red flag and may need to go through some hoops for approval. I will make the BT in $9900 and $9900 pieces one after the other. Let the first $9900 check clear and then deposit the second one.
However, it will be better if you make the BT directly to another CC instead of your checking account.
08-26-2009 09:31 AM
The entire idea is to not pay off the $19,249 in 9 months but to pay the minimum payment. This will maximize the amount at 0% interest while I pay off the other balances at higher interest rates. The 18 months at 2.99% seems like a better deal but if Chase changes my minimum from 2% to 5% of the balance then the 9 months 0% interest seems better. I have a spreadsheet keeping track of all the balances and interest rates. I'm gradually digging out and paying an average interest rate about 4%.Message Edited by GregB on 08-26-2009 06:30 AM
GregB .... I appreciate your honesty. It it is still frought with some potential hiccups. IF you are actually paying down your overall debt and not just shuffling it around from one card to another I suppose I'd give it a shot. Do you have a target date when all this CC debt will be paid off?
08-26-2009 12:17 PM
If I do a transfer to the CCs that are being paid then I would have two transfer fees. One would be the $249 max and the other about $204. That is a waste of $204 that can go to principal.
I do have a spreadsheet with all the debts listed. The total is $136K That is about $40K less than 2 years ago. $136K is only 30% more than the bills my soon-to-be-ex-wife ran up before she left. Unfortunately, at least in California, the irresponsible idiot is rewarded financially in a divorce. If she paid me the reimbursement and back child support that she owes me I would be debt free except my first mortgage.
08-26-2009 01:58 PM
$136K is only 30% more than the bills my soon-to-be-ex-wife ran up before she left. Unfortunately, at least in California, the irresponsible idiot is rewarded financially in a divorce. If she paid me the reimbursement and back child support that she owes me I would be debt free except my first mortgage.
Why ex-wifes do that all the time, I never heard ex-husband do the same to women. OT, sorry.
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