Zero percent balance transfers at 3.99%. Huh?

By glblguy


Last month I applied for another Discover More card. I had to end up getting two cards as the first one in my wife’s name wouldn’t cover the entire remaining balance on my 29.9% Bank of America credit card (crooks!).

Before any of you freak out about me getting additional credits cards, I’m transferring the balances to get a reduced rate and won’t be using the cards for anything else. As a matter of fact upon receiving the cards I immediately scanned the cards and stored to images in Evernote then sent them straight to the shredder. I just don’t need the temptation laying around. I am sure I’d be fine, but I just don’t trust myself enough.

I’m digressing….back to Discover card. I waited a week or so after receiving the card to see if the zero percent balance transfer request went through. After still receiving no notification, I logged into and checked on the status. Before I even got to the point of checking on the transfer, I noticed my interest rate for balance transfers was 3.99%. Whoa, hold the phone! I didn’t apply for a 3.99% card, I applied for a zero percent balance transfer card. I immediately called customer service.


Before I go any further, let me just say that in all fairness to Discover, out of all the crooked credit card companies, thus far Discover has been the most pleasant to deal with. Their staff is incredibly friendly, courteous and helpful.

Back to the story… After navigating their crazy/insane phone menu system, I was finally connected to a real representative. She looked at my account and told me that I had in fact responded to a 3.99% balance transfer offer, not a 0% balance transfer offer as I had thought.

I just love it when they tell me I’m wrong. In fact, I replied via a mail-in offer they sent me instead of using an online offer. I did this more out of convenience than anything. I do seem to recall some benefit of using the mailed code vs. an online offer though. Regardless, I specifically recall the offer being a zero percent balance transfer similar to the ones I offer here. Unfortunately I didn’t keep the original paperwork.

Lesson: Always keep your paperwork.

In hindsight I should have scanned the paperwork into Evernote* to have for reference. Not doing so gave me no proof of the offer and unfortunately no leverage to make them work with me.

The representative was very kind, but also firm that the offer they had in their system was a 3.99% offer and that she couldn’t change it. This is fairly typically though as most of the initial representatives that you get from credit card companies can’t do much. I asked if I could speak with someone that could further assist me and was transferred to some other group responsible for new accounts.

While the lady I spoke with was professional, she wasn’t near as nice as the prior rep. We talked and argued for a good 10 minutes, and the conversation finally came down to this: They would rather lose me as a customer than convert my current card from a 3.99% balance transfer offer to 0% balance transfer offer. She said that the system would no allow her to convert the card over. I’ve found that blaming the computer systems is a common escape goat. We hung up. I was livid.

While I am not 100% sure in my mind the offer was indeed a 0% offer, I am 99% sure. The other thing that makes me suspicious about this is that during the application process I had to fax in proof of income to a special group in the new accounts processing area. I don’t recall ever having to do that for any previous cards I’ve applied for, ever.

Here’s my theory: I probably didn’t qualify for their 0% balance transfer offer, so rather than decline me, they converted the application to a 3.99% offer hoping I wouldn’t notice. Why would they decline me? With 2 mortgages, a home equity line on the old house, and remaining credit card debt my credit score probably isn’t to attractive. I also lower my available credit as I pay these down too, which further hurts my score (for those of you who value your credit score, please don’t waste your time educating me about how stupid this is, I don’t care about my credit score as I plan to live debt free as soon as I can). It wouldn’t surprise me if somewhere in the fine print they told me this and I just failed to notice and they didn’t want to tell me.

Long story short, I seriously considered canceling the card, but honestly I didn’t want to go through the hassle of applying for another card only to find out that I wouldn’t qualify. To be honest, I’ve been happy with Discover card’s customer service. Also, 3.99% is far better than 29.99% as well as is just part of the stupid tax I’m having to pay for living on money I didn’t have in the past. I’ll just put this card at the top of my debt snowball and get it paid off as quickly as possible.

* I have an article I’m working on that will review Evernote in detail, but if you’re looking for an awesome place to keep pretty everything about your life, Evernote is the bomb. Check it out (not an affiliate link).

Think this was a bait and switch manuver by Discover? Have you had a similar experience with Discover or any other card? Want to just vent about how crooked credit card companies are? No problem, add a comment!

10 Responses (including trackbacks) to “Zero percent balance transfers at 3.99%. Huh?”

  1. Ray Says:

    I also ended up with the 3.99 card instead of the 0%, but it is better than the 18.99% from the old card.

  2. Sheila Says:

    I have used Discover for years, and have never found them to be deceptive in any way, but I have also never carried a balance (with Discover, anyway).

  3. Howard Says:

    Since I work for one of the evil credit card companies, I can tell you that the days of 0% Balance Transfer offers are coming to an end fast. With the new regulations signed into law yesteday, you will see the rates on the good credit customers going up to cover the deadbeats that work the system. I will be the first to tell you that some of the credit card practices were unethical, but as a whole, consumers that used credit wisely had a better advantage in the past than they will in the future. People with good credit, hold onto your wallets, it going to get ugly.

  4. castocreations Says:

    That is just despicable. They should have contacted you to inform you that you didn’t qualify for 0% and asked if you would like 3.99. At least that way you’d have a choice. I understand they need to make money too but dishonesty is not the way to do it.

  5. Marsha Says:

    *sigh* It’s all such a racket, no? I looked into transfering 1 of my credit card balances to another card only to be told the rate of the transferred amount would be 17.9%. Mind you, the current rate I have on the account (the account to which I was going to transfer the balance) is 9.9%.

    I just got a letter from Discover yesterday telling me my account was cancelled for inactivity. My parents also recently got a letter cancelling one of their cards for inactivity (they have zero debt and rarely even need a credit card).

    Yes, I need to develop a better strategy for eliminating my credit card debt, but the credit card companies are just making things harder for people who really are trying to do the right thing. JMO.

  6. Paul Says:

    @Marsha – ever think about using Lending Club? Good credits get 3 year loans (no prepayment penalties I think, but you should verify) in the 8-9% range (possibly lower if you’re an excellent risk). Might seem on the margine given your current rate (but how long will that last in this environment). However, it could be worth the hassle to have a slightly lower fixed rate. [Disclaimer – I invest in Lending Club notes]

    WRT the orginal post – I recently applied for a new rewards card (Schwab 2% cash back) and was a little suprised at the diligence they did (and I have an 800+ FICO). Although I was suprised (and a little put off by all the questions etc.), I find it encouraging that lenders are starting to actually do their jobs again. I just hope the pendulum doesn’t swing to far.

  7. DDFD at Says:

    UNBELIEVABLE! But not surprising . . .

  8. Kim Says:

    I’m glad you followed through and talked to them about it. It is the silent costumers that don’t help change things. I hate when people complain yet do nothing to change or understand the circumstances. Good for you.

    On the credit card topic…we recently lost all 3 of our cards. Accounts closed due to inactivity. It is nice not having credit card debt but plain weird not having any credit cards.

  9. Another Evil CC Worker Says:

    I also have a working relationship with the Evil Credit Card Companies (I don’t work for one directly, rather I provide services to one) and I would like to point out that the offer you responded to has an extremely clear statement that the 0% rate is for people with excellent credit, and if you read the not very small type in the application process, it says IF you qualify for 0% you will get it, but IF you don’t you’ll get another rate – like 3.99 – which is still darn good. Submitting the app manes you understand that Terms and Conditions. RTFTandC as I always say to people who gripe about contracts they signed.

    Look, credit is not a birthright, and unsecured credit – which is what the credit card companies offer – is high risk for the lender. They used to price on risk. While I personally don’t use revolving unsecured debt – if you decide to get into that game you need to understand that it’s no joke – it’s a tough business and the players in it are in it to make money. They will return to a blended risk model – and will work out a way to move the 30 billion in fees they used to get into interest charges.
    In the end, figure 17% average APR, NO MORE rewards and $30 to $50 a year fee per card. Expect this by the middle to end of 2011.

    Is this so bad? I don’t think so – as it makes credit available – but expensive – making it more of a considered decision and making people think more about what they can actually afford to buy and why they are buying.

  10. Justin Says:

    Pentagon federal credit union is running a 2.9% for life of balance on their credit cards right now…