I just received my Discover Platinum card with a $5,000 credit limit. I am SO pleased as I only have a Capital One Visa (secured) with a limit of $300 and an Orchard MC (unsecured) with a limit of $500. When I called to activate the card I was offered a balance transfer rate of 2.9%. Both my other cards are above 19% APR. I wanted to do it but wondered if Cap One or Orchard would put a stop on my other cards if they were annoyed by this. I would like to still have both my Visa and MC and am worried by transferring my balance to the REALLY low rate Discover card they will be upset with me and it will affect my relationship and future increases etc. with them. Does anyone have any advice about this or have they been in a similar situation? All help/advice/suggestions would be much appreciated. Thanks!
RE: Balance transfers- good id Hi Delia, congratulations on your new card! Good idea?? Oh yeah, as long as there are no transfer fees and the overall rate is lower than what you would pay if you didn't do the transfer. Don't worry about the card issuers - they can't do anything to you for transferring your balance. As long as you haven't broken any of their rules (!), they have nothing to say. If anything, you may scare them into raising your limit (yes, this happened to me - first increase in 3.5 years!). If you're still trying to build your credit with them, keep the accounts open and play with them every couple of months (buy something, make payments). The object is to pay as little interest as possible while building or maintaining your good credit history, NOT worrying about what your creditors will do to you if you upset them! WHO CARES??? I also just received a Discover Platinum (May '00). This may sound bad, but I've been playing the balance transfer game since April (3 new high-limit cards with low intro rates). I transferred 3 cards onto existing MBNA acct at 7.9, then closed them. Received my Discover card, transferred my Amoco balance at 2.9, then closed that one. This month, received two cards - Chase at 3.99 for 9 months, transferred DMB (haven't closed it yet), THEN Wells at 5.9 for 6 months and moved all MBNA balance to Wells. So anyway, my help/advice/suggestion is to do it and don't look back!! Hope this helps.
RE: Balance transfers- good id Absolutely, do it. No matter what the fees on a 2.9% APR, you are much better off than paying 19% APR. This is the principle CreditWorks is built on. Always lower your costs, the rewards will be lower rates and higher limits from your other creditors. This not only has worked for all the participants in our program, but for CreditWorks. Exercise your credit to make it grow. http://www.creditsense.com
RE: Balance transfers- good id Thanks- I switched most of my balances over to the Discover card. I hope that there are no negatives to arise frm this but it seems that you guys think it might even bring out something positive. Maybe I should call Cap One and tell them that I am considering closing my account as I have $5,500 worth of credit on my other cards and see if they offer to unsecure it or offer me a higher limit. I suppose it is worth a try... Thanks again! CreditWorks - creditsense.com wrote: ------------------------------- Absolutely, do it. No matter what the fees on a 2.9% APR, you are much better off than paying 19% APR. This is the principle CreditWorks is built on. Always lower your costs, the rewards will be lower rates and higher limits from your other creditors. This not only has worked for all the participants in our program, but for CreditWorks. Exercise your credit to make it grow. http://www.creditsense.com
RE: Balance transfers- good id Hi Delia, the other companies will have no idea that you xfrd the balances to other companies. Most balance xfers are done one of two ways: electronic payment (such as checkfree) or paper check. The companies you are paying off will be able to differentiate between the two, they will not know the balance was paid by another creditor unless you tell them.
RE: Balance transfers- good id Some people responded saying that this would improve my credit with the other companies but if they never even know I have transferred the balances how is that? I don't really understand
RE: Balance transfers- good id This is just my opinion, but I think creditors regularly, if not constantly, monitor your credit file as well as your purchase/payment history with them. If they know that you're late on your other accounts and then jack up your rate, or notice that you have opened new credit lines (and then jack up your rate!), or even that your balance on another card has shot up while your account dropped from $2K to 0, they can figure out that you didn't just pay them off out of your savings account. That may have been the case, but usually not. They know what's going on. On the other hand, if you have a pattern of charging $100 a month and making regular payments of $25 or $50, then suddenly you're not using the card anymore and that same payment or larger is still being made, they would assume that you're probably trying to pay it off. These people are in the business of tracking spending patterns and behavior, and something out of the ordinary will stand out. Again, this is just my opinion!
RE: Balance transfers- good id This is just my opinion, but I think creditors regularly, if not constantly, monitor your credit file as well as your purchase/payment history with them. If they know that you're late on your other accounts and then jack up your rate, or notice that you have opened new credit lines (and then jack up your rate!), or even that your balance on another card has shot up while your account dropped from $2K to 0, they can figure out that you didn't just pay them off out of your savings account. That may have been the case, but usually not. They know what's going on. On the other hand, if you have a pattern of charging $100 a month and making regular payments of $25 or $50, then suddenly you're not using the card anymore and that same payment or larger is still being made, they would assume that you're probably trying to pay it off. These people are in the business of tracking spending patterns and behavior, and something out of the ordinary will stand out. Again, this is just my opinion!
RE: Balance transfers- good id Jacqui,I agree most you said.But I am not sure open new account will cause creditor raise rate.
RE: Balance transfers- good id You are right - opening one new account will probably have no effect, but then again maybe opening ten won't either. HOWEVER, there are creditors that will do this, including MBNA and AT&T/Citibank. Depending on how much additional credit you have taken on relative to your income, balance-to-limit(?) ratio, the number of new accounts in a certain period of time, etc. will impact your score, possibly put you in a new risk category, and there goes your rate. It happens all the time. Please don't think I'm trying to be flip or smug or think I know all the answers, but that's what risk models were designed for.
