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Milking the Credit Card Cows

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By WhitemiataXP
September 26, 2006

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I was watching the Godfather last night and I snickered at the "I made him an offer he couldn't refuse" line as it reminded me of something that happened the day before, as I had gotten "an offer I couldn't refuse."

MBNA called me ... "you are a great customer of ours... bla bla bla ... you haven't used your card ... we want to extend a 0% on balance transfers for 8 months on your account ... we'll pay off any debt or deposit it into your checking account ... up to your credit limit."

I said thank you, politely declined, then hung up.

Then I ran the numbers... and I called them back. I remembered that they kept increasing my credit limit to insane amounts that make no sense so I asked what my limit was, and how much I could transfer. The answer was $34,000 and "up to the limit."


What's the cost? 3% of the balance transfer, or $75.00 whichever is smaller.


So let me get this right, I can borrow $34,000 at ZERO percent for 8 months and pay $75.00 for it (plus interest at 13.99% on that 75 accruing monthly of course - that's about $87.00 total considering a minimum finance charge of $1.50 which I think is what they charge).

So I went for it.

I figure I'll have this $34,000 show up in my checking account by late this week. I'll then turn around and put the money in a 6 month AmTrustDirect CD at 5.36 APR (5.50 APY), send AmTrust a letter telling them not to renew it, and after the 6 months, move the money to their eMoney Market account (currently about 5.26APY) for another month and a half, then pay the credit card off directly from the MM account.

When all is said and done and I've paid Uncle Sam his share of my profits and subtracted the finance charges I'll be paying monthly, I'm looking at somewhere around $750.00 added to the coffers.

(Yes, for the more astute readers out there... I will have to come up with the minimum monthly payment from a different account, but if I couldn't' manage that [I can] I would have simply determined what amount those minimum payments would add up to, and put that portion of the loot into a MM rather than the CD.)

And that's for 15 minutes of phone conversation, 5 minutes of setting up the automatic payment from my bank account (you don't want to forget to pay the CC... otherwise with these offers you're dead meat)... 10 minutes setting up the CD ... 5 minutes writing the letter to not renew the CD... 10 minutes to call and confirm they got the letter and the CD will not renew (an accidental CD renewal would spell DISASTER... where am I gonna get $34K to pay the card back?), 5 minutes to transfer the money to the MM account and 5 minutes to set up the payment of the full balance in May.

Add it all up and I'm looking at a rough 45 minutes of work. Round it up to an hour, and I'm still making $750/hr. Boy a dream come true :-)


P.S. any tips on other ways to milk the CC cows would be greatly appreciated.

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