balance transfers

[notyou]

Are there downfalls to balance transfers?

I have a newer credit line that will allow me to transfer the balances on ALL of my cards. I am not at all concerned that I would be able to refrain from charging the balances back up. (the scissors and I would be good friends ha ha)...  I know it wouldn't really affect my fico either way, but it may simplify things for me (one check vs 8-9).... The interest rate is lower or about the same on all the cards except one. (which has introductory no interest for another 2 months) I just want to make sure I'm thinking it through before I do it. (which so often I come here and ask questions AFTER I do something!)

[Chris123nTx]

Nothing wrong with it, but saying you wont have to worry about charging them back up, well, if you currently have a balance on 8 or 9 credit cards, then be real real sure that whatever enabled you to have balances on so many cards is really different or you run a very real risk of runningthem back up.


Only you can decide if you have seen the light. The statement you made about cutting up your cards so you dont have to worry about it should give you pause though.

As an aside, do you really still write checks?

I had someone using a paper check in front of me at the grocery store the other day! I wanted to tell her that it was converted to an ach right then anyway so might as well use the debit card sitting right next to the checkbook. Now, back in the olden days when you could still float a check for three or four days..

[LS2982]

I dont think your new creditor would have a problems with BT's but like the poster said I would make sure you have yourself in check afterwards as far as running them back up.

[pizzadude]

The only downside to this might be if some of your creditors decide to drop your CL or close your account after you pay them off.   This probably won't happen, but it's the only potential negative outcome that comes to mind, other than the obvious problem of spending on your newly paid cards, which you have mentioned.

It may help your FICO score to consolidate everything onto a single account since FICO utilization scores the number of accounts with balances, so only having 1 card with a balance out of 8 or 9 cards is positive.

And I certainly like the idea of simplification, only having to write a single check each month instead of several is good.

[marty56]

You must be able to PIF before the term expires otherwise you will owe intrest from day one.  Also you could now have more cards reporting a balance which could lower your FICO score.

I would not do it unless you have at least a year to PIF and be careful of the minimum payment due since it probably won't be enough to PIF by the term date.  Sneaky but legal.

[LS2982]

@marty very good point!

[notyou]

No I definately don't write paper checks anymore! Only to the lady who does my hair because she is out of her house and doens't take plastic! When I said only one check to write I meant from online banking... The bank mails them a check. I don't do auto-pay yet. I'm thinking about setting everything up on auto-pay through the new card I want to BT to. On a side note... I actually saw a guy write a paper check at the grocery store the other day too! All I could think was c'mon buddy... I got somewhere to be!

I have balances now because I didn't know any better. I thought it was good to have balances and just pay every month. WHO KNEW! ha ha. But seriously. I used several cards this month instead of my checking account. Getting a feel of things if I used credit instead of debit. I only actually carry a balance on four cards. I know that still bad, but it's better than 8 or nine! The other four are being PIF'd tomorrow. I was trying this out using several cards instead of just one. (see other thread about using small CL account vs larger ones).. it's way too confusing for me to try to use a couple and pay the charges I make. I won't actually take the scissors to the cards. They'll be put in glass with a break only in case of emergency sign. I will tell the wife she is NOT Wile. E. Coyote. and new shoes do NOT constitue an emergecny! I am definately not arrogant enough to say... it won't happen to me. I do however have the tools to make it harder (for lack of better wording) to happen to me. (tools= Knowledge)

Marty. The card I am thinking of BTing to is not no interest. It is however lower interest than the cards that I do carry a balance on.

Pizzadude- The ones I want to BT are HSBC and cap one. My feelings would NOT be hurt if they closed up shop on me! ha ha

[LS2982]

@notyou Wtg!! Thats a very good plan!

[notyou]

PS... I said 8-9 because if I do BT I will do that tomorrow instead of paying them off I will BT them and then make one large payment to the new card? Bad idea? I was thinking it was good because they would see... oh look here, not you wants to BT and pay us large chunks not $10 a month.

[pizzadude]

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@marty56 wrote:

You must be able to PIF before the term expires otherwise you will owe interest from day one.  Also you could now have more cards reporting a balance which could lower your FICO score.

I would not do it unless you have at least a year to PIF and be careful of the minimum payment du since it probably won't be nough to PIF by the term date.  Sneaky but legal.

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This is true with many promotional purchase 0% offers, but most BT offers that I have seen just revert to the normal purchase rate after the initial period, and don't charge interest rectroactively.

I do agree that it would behoove the OP to double check the T&Cs of the offer to be certain.