I applied and was approved for a new credit card yesterday. Yikes! I haven't had one of those in three years. I'll not use it for any purchases, only a balance transfer of CC#2 - the 16.99% APR monstrosity.
Some stats: My credit limit will be $5,000. So, less than half of the limit will be taken up by the transfer. The balance transfer charge is 4% of the amount transferred. The six month introductory APR is 0.0%. Then, it increases to a rate between 9.99% and 20.99%. Ouch and ouch. I don't know yet what the APR will move to, but will find out when I receive the card and details in the mail.
Some calculations: Best case scenario is to have the entire balance paid off by next March - With a 9.99% APR. If I (we) can do that, I project that we can save $127 over what we would have paid in interest by keeping the balance where it is. If the interest rate spikes up to 20.99%, and I don't have the balance paid off until next April, we'll save $43 over keeping it where it is.
If the balance is not paid off until May 2012, at a 20.99% rate, I will go backwards $24. If the rate goes to 9.99%, I have until July 2012 before I go backwards.
It may seem like an awful lot of hassle just to save $127 over the course of 8 months. It probably is. But, I feel as if I've waged an all out war against credit card debt, and every small victory is a step closer towards my ultimate goal of being credit card debt free.
I will shred the card as soon as it arrives in the mail.
CC Balance Transfer
July 20th, 2011 at 05:34 pm
July 20th, 2011 at 08:12 pm 1311192752
I recently transfered to Citi Dividend Select Platinum MC, the terms are 3% BT fee and then 0% for 18 months. Here is the link, in case you would like to do more transfers.
http://creditcards.citicards.com/usc/platinum/MC/external/af...