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How's this plan?

April 7th, 2009 at 10:57 pm

Ok, I just need some other eyes to look this over...

I have four credit card debts that I am trying to pay off. Boo! They were from last year, farm start up costs...and I am really concentrating on paying them off. They started out at 0% interest, but that ship has sailed. So, the bad news:

Bank of America..$15,093 @ 13.24%
Capital One.......$1,882 @ 0%
Chase Visa #1:....$6,018 @ 9.24%
Chase Visa #2:...$11,130 @ 9.99%

The good news:
I am paying much more than the minimum, and haven't charged any to the cards for months.

The plan:
I have an offer for a 5.99% fixed APR for 2 years on Chase Visa #2, with 3% btf, in the form of a check. I have a $15,500 credit line on this card. At first I thought just to transfer ~$4000 something over to Bank of America because it has the highest interest. But, I just thought of something. I have $11,200 dollars saved up for the land payment due in June and the taxes due in May.

What if I pay off Chase Visa #2 with this money and then write myself a check for $14,850.
$14,850 * 1.03 = $15,295.50 (amount after btf)
$15,295.50 * ( 1 + (.06 * 2 / 12) ) = $15,448 (2 months interest, just to be safe)

Save the $11,130 for the land/taxes and put $3720 on Bank of America.

Doing this, I just dropped the interest rate on Chase Visa #2 from 9.24% to 5.99% for 2 years (and cut off their imminent plan to up the interest...I just know that will happen!) and dropped $3720 from $13.99 interest to $5.99% interest. I can't say I paid that off because that is really a balance transfer, but it does save me money.

Am I missing something? I have to do this in the next week or the offer will be over.

3 Responses to “How's this plan?”

  1. jillybean Says:

    Not sure, but if you write the check to yourself it may be counted as cash advance and not a balance transfer--double check the fine print.

  2. cptacek Says:

    Nope, it says you can use it for anything, and explicitly says you can write it to yourself...

  3. dmontngrey Says:

    I say go for it! As long as you've read the fine print and understand the offer, this can be a VERY useful way of cutting interest rates. I've done this many times myself.

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