I am very fortunate to have good credit and have received many offers for zero interest balance transfers, convenience checks, etc. and high credit limits with caps on the transfer fees (usually $50 – $99). Is there any downside in just taking all this ‘free’ money? How do banks make money on these deals? My plan is to write myself a huge check and deposit it so that it can make interest. Why does this sound too good to be true? BTW where can I make the most interest on this money but have it liquid enough to pay back when the introductory period expires?
I hope you heard yourself when you asked how can they make money when they give you ‘free’ money. There is nothing ‘free’ from those snakes. They are counting on you hitting on one of their hidden tricks so that you will automatically jump to the 30% rate, slammed with late fees because your payment did not ‘post’ in time, etc. These slimy organizations are known for holding you payment, even electronic ones, until a day or so after your due date, just to slam you.
At most, you might make 3% on the money you ‘bank’, because you will be making the monthly payments, and you better count on an electronic payment hitting on a holiday or Sunday or some other day when it will not get credited to your account.
I got in trouble with this ‘free’ money. Believe me, nothing is free. They will end up making money off you one way or the other.
In my case, I am not going to deny responsibility – I abused the credit. Nevertheless the companies must share some responsibility for making it look free, when it isn’t.