I have a new 0% credit card

By glblguy

clownfish2

Before you close your browser and stop reading, let me explain…

I have my credit card payments set-up for auto-bill pay. I make sure all of my payments go out on time and even provide a “buffer” just in case something goes wrong. About 6-months ago, I received my statement for my Bank of America credit card. The interest rate? 29.99%  WHAT?

I quickly called customer service and they stated that my payment was received late. Late payments automatically cause the low interest rate to jump to 29.99% along with a $35.00 late fee. I explained to the rep when my payment was received and confirmed with my bank that Bank of America had indeed received the electronic payment on time. I called Bank of America back and was told that the payment had been 2 days late. After some arguing and “fussing” (as we in the South call it), they waived the late fee and put the interest rate back. They clearly said though that this was a one time courtesy (gee, thanks).

Flash forward to November, I again received my statement and saw a $35.00 late fee and 29.99% interest rate. This time my payment was received a day late. I again called my bank and confirmed that the payment was received a few days prior to the due date. I called Bank of America back and they refused to waive the fee or reduce the rate. I spoke with several supervisors who all said there was nothing they could do. I hung up, and immediately went online to begin looking for a new 0% rate card.

0% Discover Card

I had heard really great things about Discover and had received a few mailers from them in the past about their 0% offer card. I applied online and was quickly accepted. I also specified that my balance from Bank of America be transferred over. A week later, I received the card in the mail along with a note stating that most of the balance was transferred but that my new credit limit wouldn’t cover the whole transfer amount….hmmmm.

I called Discover card to find out why. It would seem given I currently have two mortgages and their more “conservative” recent credit practices they couldn’t do the full amount, BUT they did say they would denote my account and provide a credit limit increase as soon as they could. Ok, not perfectly happy, but most of the Bank of America balance was now on a 0% card instead of a 29.99% card. I was happy enough.

Hopefully soon Discover will bump my limit up enough to move over the entire Bank of America balance and I can have the pleasure of calling them back and closing my account.

0% Card Offers

A number of my blogging buddies offer various credit card offers on their site. I would like to consider adding a page to Gather Little by Little for 0% credit card offers. Note, I would not in any way condone using these cards for anything other than moving over higher interest rate debt. As you well know, I very much respect you as my readers and before doing this, I wanted to get your take on it. I certainly don’t want to encourage anyone to get further in debt either, but at the same time I cannot control the decisions people make, only make recommendations.

I really debated this whole thing for a while, as you well know I hate credit cards. But I really believe it just makes smart financial sense to pay minimum interest when you do have debt. Transferring your balances to 0% cards will do this for you.

Some of you will be happy to know that I cut my card up as soon as I received it. I used the boring shredder method.

Anyway, what are your thoughts? Would you be ok with me doing this? Let me know what you think, add a comment!


20 Responses (including trackbacks) to “I have a new 0% credit card”

  1. Green Panda Says:

    I can understand why you got the credit card. Having practically 30% is ridiculous, especially considering they are making the mistakes! I hope you can get the rest transferred soon. I’m not a fan of Bank of America.

    BTW, did you get the fish design card? :)

  2. Jeff Says:

    FYI – your 0% links in the article seem to be broken.

    I just made a similar move, transferring from a 10% card over to a temporary 0% card. Even though it’s temporary (through November), it’ll save me about $150 and a couple months of payments, so I’m ahead.

    I have no problem with you putting up a page with 0% offers.

    How long is your 0% rate with Discover?

  3. outdoorgrrl Says:

    I don’t think there’s anything wrong with taking your business somewhere else, if the BoA is not acting appropriately. I would take an additional step, however, and report them to the Better Business Bureau. Your state’s attorney general probably also has a consumer protection division that will be interested in knowing about BoA’s practices.

  4. Gina Says:

    I understand why you transferred the balance. I did a similar thing February 2008 for practically the same reason, also BofA.

    Allow 0% offer advertising on your GLBL blog? That is a tough call.

    Being that you (and I) are a fan of Dave Ramsey, would it be hypocritical to “allow” credit card advertising when he teaches borrow no money? Dave won’t even allow a buyer to pay with a credit card when you purchase any of his products. However, on his radio & tv shows he isn’t able to control the advertising (he doesn’t own the networks). On the other hand, would allowing that advertising bring in revenue for your blog?

    Personally if it means additional revenue for your blog I would do it.

  5. Miranda Says:

    Good for you!

    Although I am surprised. I’ve only had good experiences with BoA.

    If you can help others find a better rate — after getting a better rate yourself — I’d say go for it. But then, I’m an advocate for responsible credit card use (paying off balances and getting rewards, etc.).

  6. d Says:

    This is one of those practices that the big wigs in DC need to take care of…..its the little guy that keeps getting messed with. I would totally do it,,,I can’t wait till you can post that you called them and canceled their crappy buisness!

  7. Travis Says:

    I guess I’m confused as to why you have the credit card in the first place. Is it one of those deals that you pay everything on the credit card to get the rewards? I would be mad if BoA charged me a $35 late fee and upped my interest rate to 30%, but couldn’t this have all been avoided by simply not having a credit card. I mean they’re in the business of making money, not helping you out, lets not forget that.

  8. Sam Says:

    Of course you should move to a 0% card. Even if you had made late payments, 30% is ridiculous and you shouldn’t pay that much. Try to get out of debt asap. It sucks being controlled by cc companies. :)

  9. No Debt Plan Says:

    Were you not able to find a 2nd 0% offer card to transfer the remaining balance to?

    I’d leave in a heartbeat. BoA seems to be going down the tank as I’ve heard multiple stories on this lately.

  10. Catherine Says:

    PLEASE report Bank of America to the Better Business Bureau and – time permitting – research online other people who have had this same problem (hopefully, everyone will, as well).

    This is FRAUD and THEFT. A LOT of people won’t (or can’t) switch card companies. The amount of money that BofA is making on their “mistake” is probably astronomical!

  11. glblguy Says:

    @Green Panda – Yep, got the fish design! I wanted to keep it as I thought the picture was great and I love clownfish, but didn’t trust myself enough yet to keep it around, so cut it up.

    @Jeff – 0% until February 2010. Fully intend to have it paid off by then I hope.

    @Gina – Thanks for the feedback Gina, and yes I do get a referral fee.

    @Travis – Remnants of the debt days where I used credit cards like they were going out of style. It’s the last one I have, and I can’t pay it off soon enough!

    @NoDebtPlan – Thought about that as I was writing the article actually. I’ll look into that. This whole thing of applying for credit cards makes me a nervous wreck!

    @Catherine – I agree, but proving it is far more difficult.

    Thanks for all the feedback and encouragement. I’ll get some 0% offers up soon.

  12. Mr. Imperfect Says:

    I think it would be a great idea to have some 0% card offers listed. We are also fans of the Dave Ramsey plan, and are currently on step two. As far as not having credit cards…if you can keep them in your pocket, not a problem. Case in point, a $1000 emergency fund will not cover a $3500 new roof when it starts to leak. I see no problem using credit cards for real emergencies, and if you are going to use one have one with a 0% interest rate:)

    Have a great day!

  13. Alison@This Wasn't In The Plan Says:

    Just wanted to let you know that two times we’ve accidentally paid our Discover card bill late and they’ve gladly refunded any fees since we otherwise have a good history with them – in other words pretty much the opposite of BofA.

  14. debtmaven Says:

    Good for you, move move move. Don’t give that crappy bank any more undeserved money. They definitely sound like crooks!

    I just got the same card for the same reason. I have a Line of Credit loan with Wells Fargo and they just raised the rate about 2% (still only 10% now). The only way to opt-out is to pay it off in full, which I couldn’t do. I am going to transfer about a third of my remaining balance to Discover (they would only give me a 5K balance) this week as I just got my card. There’s a 3% transfer fee, but still, a year without interest is worth it in the end.

    Best of luck!

  15. Mr. ToughMoneyLove Says:

    This probably excludes you, but if American consumers in general would apply as much time and effort towards paying off their debts as they did thinking and scheming to find the best credit card deals, we could put a lot of these obnoxious credit card companies out of business and into more productive activities. Indeed, if it weren’t for credit card and FICO score obsession, half the PF bloggers (again not you) wouldn’t have anything to say.

  16. Evelyn Says:

    I have heard the late Larry Burkett of Crown Financial Ministries tell people to move their high interest credit cards to low interest credit cards and to cut them up as you did. Larry would tell them to keep moving the money to new credit cards if they had not paid off the credit payment. But he always told them to agressively pay off the debt. You are doing the right thing!

  17. Gypsie Says:

    I am a huge fan of DiscoverCard! As Alison above said, the couple of times I accidentily had a late payment, they waived the fee without a problem.

    Also, I had my Discovercard account number stolen once. The thief charged more than my limit on my card and Discovercard was quick to help. Not only did they remove the damages the thief had charged but they also removed the over limit fee I incurred. They did this immediately before they started the investigation. AS promised, 90 days later I recieved a copy of their investigation. They found that the card number had been used with an incorrect expiration date. They also walked me through all of the steps that I needed to do to ensure all authorities were notified and helped set up the fraud alert on my credit reports.

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