Want to buy Bluebird

[Dorn Hetzel]

Many of those deals come with "balance transfer checks". They usually
charge a "balance transfer fee" or 3% or 4%, but the good deals *cap the
fee* at $90 or so per check. Now if you write several small checks, or the
fee isn't capped, it's a horrible deal. But..., if you:

1) start with a completely empty card (sometimes they make you charge $100
or so first to get the deal, but just spend the $100 on something you were
going to buy anyway and then send a payment the same day of $105 )

2) only write one check, and make it as big as you can while staying a
little clear of the credit limit (the deal is almost always voided if you go
over limit) (so, $19K on a card with a $20K limit) So, the capped fee
of perhaps $90 is less than 0.5% of $19K.

3) Set up automatic payments of the minimum due so that you will never, ever
be late (that voids the deal too)...

4) Put the money in savings, (or one time I payed off a chunk of the home
equity credit line I had used to help buy my house)

5) About two weeks before the deal runs out move the money around and pay it
all back (out of savings or back out of the home equity credit line or
whatever safe place you stashed it)

6) Feel good about your almost free use of the banks money to make or save
some interest. (my personal was the 12 months paydown on my home equity
line since I was paying 7.75% on that at the time, so I saved over $1500 in
interest during that year which all went to reduce the principle I owed on
my house)

Note, this is only worth doing if your credit is good enough to get a decent
credit limit of $10K or more. If they only loan you $4000 then the $90 fee
is a much larger percentage. It also isn't a good deal if you only get 3
months at 0%, avoid deals with less than 10 to 11 months or more.

If the card won't give you a good deal with a big limit right away then get
it and just plink around with small charges and pay it off every month until
they decide to send you an offer to see if they can "entice" you

Your mileage may vary, but it's been a good deal for me several times.

I did notice that after you really ride one of these deals for a year and
they don't make any money on you, then a year or two will go by before they
send you another one But, still, $1000 in free savings every third year
is better than a sharp stick in the eye

Regards,

Dorn Hetzel
77FC35
Hogansville, GA


On Nov 26, 2007 3:18 PM, bubblerboy64 wrote:

> Dorn, Show how out of touch I am. I thought those deals were only to
> transfer from one credit card to another. How do you get the money
> into the first account to start with out being in debt to the tune of
> $19000 in the real world?
>
> John Heckman
> central Pa
> 1973 FC
> >
> > My favorite form of financing is the periodic credit card deals of
> 0% for a
> > year or so on balance transfers. If the fee has a cap, which they
> always
> > did until lately and some do still, I just take the money and put
> it in my
> > savings account at 4.75% $90 to borrow $19,000 for 12 months
> and earn
> > almost $1000 in interest... Who would turn that down?
> >
> > Of course, they play the odds that you won't be ready or willing to
> pay it
> > all back before the special deal expires, and I'm sure many can't
> or don't,
> > but if you are willing to pay attention to the details, you can
> come out
> > ahead
> >
> > On Nov 26, 2007 2:48 PM, bubblerboy64 wrote:
> >
> > > Jon, You want the economy to crash? :-) Pay cash? What's cash?
> > > This is way off topic, but there is a generational difference
> isn't
> > > there? Interesting how priorities are affected by past experience
> > > and age.
> > > John
> > > The Big Napper
> > >
> > >
> > > >
> > > > --- In
WanderlodgeForum@yahoogroups.com
> > 40yahoogroups.com>,
> > > "Gregory OConnor"
> > > > wrote:
> > > > >
> > > > > If you want it , buy it. If you cant afford it, borrow it.
> > > > >
> > > > > I understood 'Good reasons to finance stories' were
> > > justifications
> > > > > for making a financed purchase. A reflective look at my
> position
> > > > > reveal that my "financing is for idiodt theories" ARE healing
> > > > > justifications wence turned down for a loan.
> > > > >
> > > > >
> > > > >
> > > > > GregoryO'Connor
> > > > > 94ptRomolandCa
> > > > > "Motorhomes with slides are for idiots"
> > > > >
> > > > >
> > > > > --- In
WanderlodgeForum@yahoogroups.com
> > 40yahoogroups.com>,
>
> > > "Ryan Wright"
> > > > > wrote:
> > > > > >
> > > > > > On Nov 23, 2007 1:35 PM, martingregg598
> wrote:
> > > > > > >
> > > > > > > Financing may be the way to go. Let's say that you are
> going
> > > to
> > > > > buy a
> > > > > > > $100,000 plus BB. If you get a 20 year note at 6% interest
> > > for
> > > > > 100g,
> > > > > > > the unit qualifies as a second home and you can deduct the
> > > > > interest,
> > > > > > > and you leave your 100g properly invested returning an
> > > average
> > > > > of say
> > > > > > > 10 %, you are making a 4%- plus gain every year on your
> 100g
> > > > > > > (depending on your specific tax situation).
> > > > > >
> > > > > > Sort of, not exactly. You need to take money out of that
> $100g
> > > > every
> > > > > > month to make the payments on the coach, so you're going to
> > > slowly
> > > > > > dwindle it down, reducing your return. Unless you make the
> > > > payments
> > > > > > out of your income, in which case I don't think you'll be
> all
> > > that
> > > > > > well off. Follow me here:
> > > > > >
> > > > > > In your example the payment would be $716.43 per month. If
> you
> > > > take
> > > > > > that same money and invest it at 10% over 20 years instead
> of
> > > > paying
> > > > > > it to the bank, compounded monthly you'd have almost $550k.
> > > > > >
> > > > > > On the other hand, if you leave your $100k in the bank for
> 20
> > > > years
> > > > > > and don't pay any extra into it because you're making
> payments
> > > on
> > > > > the
> > > > > > coach, at the end of the 20 years you'd have about $730k.
> > > > > >
> > > > > > Now 730 - 550 = $180k. Interestingly enough, at the end of
> the
> > > 20
> > > > > > years you'll have sent about $172k to the bank to pay for
> your
> > > > $100k
> > > > > > coach. Which leaves you only $8,000 ahead by financing it
> and
> > > > > keeping
> > > > > > your money in the bank.
> > > > > >
> > > > > > Let's look at the risk you get for your $8,000: You risk an
> > > income
> > > > > > crisis and not having the ability to repay your loan. If the
> > > > market
> > > > > > happens to be down about the same time, which is often the
> case
> > > in
> > > > > > financial hardships (Murphy's Law), you risk losing your
> > > > portfolio
> > > > > as
> > > > > > you yank everything out in a down market to get the
> creditors
> > > off
> > > > > your
> > > > > > back. You risk huge spikes in interest rates and fees should
> > > you
> > > > > miss
> > > > > > a payment by accident.
> > > > > >
> > > > > > Is it worth it? Not to me. Assuming you have the discipline
> to
> > > > > > re-invest the money you would have otherwise sent to the
> bank,
> > > I'm
> > > > > > paying cash for the coach and rebuilding my portfolio out
> of my
> > > > > > income.
> > > > > >
> > > > > > Now, if you're actually able to itemize the interest out on
> your
> > > > > > taxes, you might -- MIGHT -- be able to recover enough to
> make
> > > it
> > > > > > worth the effort. Typically, though, that isn't the case.
> The
> > > > > standard
> > > > > > deduction will typically be higher than the interest on the
> > > coach
> > > > so
> > > > > > unless you have other major things to itemize, you're no
> money
> > > > ahead
> > > > > > with the tax man.
> > > > > >
> > > > > > In my experience, financing for the interest or tax savings
> is
> > > > > usually
> > > > > > a negative to zero sum game, or otherwise close enough as to
> > > make
> > > > it
> > > > > > not worth the risk and/or the hassle.
> > > > > >
> > > > > > -Ryan
> > > > > >
> > > > >
> > > > I guess I'm from the old school of financing and that is pay
> for it
> > > > with cash!!! I really believe that is what is wrong with America
> > > > economy today and that is everything is on time payments. What
> > > > happen to the days that when you bought something and you paid
> for
> > > it
> > > > or you did not get it? Oh well if a person wants to pay 10
> percent
> > > > interest on anything than go for it but for me its cash only and
> > > save
> > > > paying the interest. Product of the depression with a depression
> > > > attitude! Jon
> > > >
> > > > Jon
> > > > Rebel Bird
> > > >
> > >
> > >
> > >
> >
> >
> > [Non-text portions of this message have been removed]
> >
>
>
>


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