Are 0% APR Balance Transfer Offers Coming To An End?
If you are making money off of balance transfers or have been considering it, the following observations might be of interest to you. Otherwise, it probably won’t 
The Bad News
A few months ago, Citibank started saying “Balance transfer fees apply with this offer” on certain applications, even though the Terms and Conditions clearly stated that there was still no fee for initial balance transfers. Then, a few weeks afterwards, the longstanding Citi Platinum Select card, which used to offer a sweet deal of 0% APR on purchases and balance transfers for years, started charging a fee.
More recently, on May 1st, Discover stopped offering no-fee balance transfers on all their cards, instead implementing 3% fees with $50 to $75 caps. The Miles Card by Discover still offers 12,000 bonus miles, which is worth $100 in travel credit to offset the fee.
The Good News
Still, there are plenty of Citibank cards that remain which offer 12 months of 0% APR on balance transfers with no initial balance transfer fees: (none anymore)
For alternatives, please see my list of updated
best 0% APR balance transfer offers.
Should I Save Some For Later? (SFL)
Also, if you are concerned about having less 0% APR offers in the future, you can actually “tuck away” one or two of them for later. In the Terms and Conditions for the cards marked “SFL” above, you will see this:
Balance transfer APR: As long as first balance transfer is completed within 12 months from date of account opening, 0.00% for 12 months from date of first balance transfer. After that, XX.XX% variable.
So, you can actually wait 12 months from the date of account opening to start the balance transfer, and then still enjoy 12 months at 0% APR. Some of the cards also offer rewards programs (marked “Rewards” above), which can give you cashback on everything from utilities to restaurants, whatever fits your spending the best.
Got questions? Please read my details series of step-by-step posts on how I and others do this first. Lots of good stuff there!
Find more in Credit Cards, Deals & Offers | 5/14/07, 12:54am | Trackback
May 14th, 2007 at 1:26 am
This has nothing to do with the topic at hand, but what do you think about PayPal’s money market account? They are currently offering a 5.02% interest rate on it, and it looks pretty good to me. I still have my normal ING Direct savings account, but I’m thinking about starting to sell some of my art collection on eBay and keeping the money in there for a while to let it grow.
May 14th, 2007 at 1:28 am
Please see my post on Why I don’t trust PayPal with large amounts of money.
May 14th, 2007 at 3:59 am
Do any of these cards give you 0% on cash advances? If I don’t have a balance worth transferring can I get started in this little game without paying a fee or interest to someone?
May 14th, 2007 at 5:56 am
Yup — definitely slowing down. We may need to break down and come up with a new way to exploit the system
May 14th, 2007 at 5:58 am
I am very close to attempting my first balance transfer but a possible problem I face is that I currently am only holding 3 cards Citibank Platinum Select, Chase, and a recent Chase Freedom Card ($250 after first purchase). I guess my question is how many times I can add transfers to any one card.
In the past you mention that Citi is the easiest to get the transfered cash out of but what type of frequency would put up red flags, in other words if apply for and am approved for both ATT/Citi and Discover Miles today and I do a BT to Citi on the Discover could I then do another BT to Citi after I?ve made my first purchase with a the ATT/Citi. Or would it be better to request that transfer to go to one of the Chase cards. Also within card families can Balance transfer be made sucessfully. I have always had credit cards but I never use them so balances are always zero and even if they were used they?ed be paid in full every statement.
Any comments would be appreciated? also how easy is it to get BT funds out of Chase and into my personal high yeild (5.36% APY Am Trust Direct) bank account.
May 14th, 2007 at 6:00 am
3% fee doesn’t necessarily mean that - Fidelity gave me 10k and refunded the 3% fee as a convenience. You just have to *be nice* to the right csr
Usually takes a phone call or two. I just tell them “I’d really like to transfer my “credit card debt” or “pay my tax return” to your card but that 3% fee seems like a lot.
May 14th, 2007 at 6:59 am
How does maxing out individual credit cards affect your FICO score? In the past, I’ve taken advantage of these while maxing out a card’s limit. I’ve seen my FICO score drop by as much as 20 pts for each card I have maxed out. This would be bad if I’m going to apply for a mortage or car loan in the near future.
May 14th, 2007 at 7:56 am
I noticed that many zero balance cards haven’t been offering me any deals except ones that were 3% fee without a maximum fee. I was thinking that it was just me.
May 14th, 2007 at 8:31 am
I remember seeing angst like this back in 2002, and even got a coupla (mildly) gloating emails from friends to the tune of “You may be getting over now, but not for much longer, suckah!”
Here it is 2007, and I’m still getting over…..
May 14th, 2007 at 9:48 am
Yeah, I’ve been seeing lately the “3% of balance” with NO limit lately! That’s pretty scary. There’s really very little margin to make money with these deals. Even at 0% - and some of them aren’t even for a whole year; like now they’ll say “0% till January 2008! (whoopee doo, that’s like 6 months?)” And then they’ll add the 3% fee. Hey, that’s pretty smart — let me lend people my money at “0% (Ha-ha)” and then charge them 6% a year to have it. Also, if they are late making payments, raise the interest to 29.9%, tack on a few $39 fees a month and take them to the cleaners.
Oh, well, can’t complain too much — Citi’s been pretty good to me and I’m up $50 so far this year. Unfortunately, I was so busy looking at my balances lately that I made a late mortgage payment (very swift I know). I just missed paying on time (the way I always do) and paid an extra $25 in interest. I think having all these accounts is hard to remember with my limited brain cells. Now I’ll be paying my mortgage 2 weeks early to avoid this mistake again.
May 14th, 2007 at 10:22 am
Doug - There are many ways to get cash out even by doing a balance transfer. See here.
Eric - Balance transfers usally cannot be done within the same card issuer, like Chase to Chase. But I would BT from Discover/Chase to an old Citi card, and request a check online. For new ATT/Citi cards, you can just request a check directly without having to transfer to another card.
I replaved SVL with SFL - Can’t even get my acronyms right.
Ken - I think there will probably always be profitable balance transfers, it will just depend on how profitable.
May 14th, 2007 at 10:23 am
mimi - your post explains better than I could to the reasons why I would never try to borrow 20k to net $70 a month. Too risky, and not worth it. The money isn’t “free”. You have to work to earn it by analyzing, reading, keeping track, and making damn sure you don’t make one mistake. That one mistake jeopardizes all of your work.
May 14th, 2007 at 12:03 pm
All of this hurts my head! Bless all of you that are making cash at this, but I need to spend my free time researching stocks and investing.
May 14th, 2007 at 6:03 pm
Of course, the whole idea of 0% BT is to find cards with no fee, or a at least a cap on the fee. With a 3% uncapped BT fee, after taxes it not worth it unless you have a huge credit line.
May 15th, 2007 at 2:37 am
Hi, and thanks for the updated article J. I hate advertising, but if a 6-month period is worth to do for BT-banking, then surprisingly, Bank of America (FIA Card Services, N.A.-there credit cards’ division) has the following: Visa Platinum Plus, Financial Rewards Visa Platinum Plus, Money Return Visa Platinum, and the Efectiva Visa Platinum Plus credit cards that has no fees on balance transfer transactions; but 0% APR for first 6-billing cycles only.
May 15th, 2007 at 4:16 am
Chase offered me 0% for 18 months a while ago with no BT fee during the entire period. They also gave me a $15K credit line. I think it was pretty decent.
May 15th, 2007 at 9:33 am
A few weeks ago (thge morning of May 1 to be exact) I went ahead and opted for the Discover Card mentioned in the posting, following Jonathan’s advice of including the balance transfers with the application- I am most certain that the no fee clause was still in the application and even recall reading it. I received the card yesterday and went to activate it. The CSR indicated that they have no record of any balance transfers accompanying my application and if I wanted to go ahead with one I would be charged 3% or $10-$75. After several rounds with departments (accounts, customer service, balance transfer) a CSR manager stated that upon looking at my application in greater detail the online application was not “no fee” and if I had a “screen shot” (exact words) of the online application they would allow the no fee balance transfer- sounds absurb to me- who keeps a screen shot of their application?? After a few more minutes of discussion, I was offered 1/2 off the fee; which I took just to get this over with.
May 15th, 2007 at 11:27 am
Chris, it’s ALWAYS a good idea to take the screenshots of the deals - you’d be surprised how often they came to my rescue. Real moneysavers, they are!
May 15th, 2007 at 12:59 pm
I will open about 15 - 20 cards in a few months. I only have 32,000 in balance transfers left and 12k will be due in 1 month and another 10k will be due in 3 months. The other card is a 2.9% apr for the life of the balance.
I’ll do some research in the mean time.
May 20th, 2007 at 10:00 am
Citi bank cards allow you to send yourself a check or pay off another account using balance transfer. Does sending yourself a check count as cash advance? It seems like it would….
May 20th, 2007 at 10:02 am
Nope, for Citi it is a balance transfer.
May 23rd, 2007 at 9:05 pm
I too got hit with Discover’s bait and switch - still worth it IMO, however.
Citi Bank will shift credit limit balances around, FYI, in case anybody missed it. When my current deal expires I hope to get a new card which will add an additional 1-5k to my available Citi credit line and then I’ll exploit that card by shifting all available credit to it, and so on - so forth…
Does anybody use an autopay or schedule cc payments way in advance? Less room for error this way?
May 28th, 2007 at 9:22 pm
I recently applied(on April 22nd) for Discover card after seeing the post here. I believe there was no balance transfer fee during that time and it came into existence only from May 1st.(does anyone has any proof on that). The Discover has charged me $75 as balance transfer fee and they claim that the charge has been there as long as they know.Does anyone has any idea how to get the fee waived.any help will be appreciated !