tell me why this won't work (balance transfers)

bgmnt2000

it's my understanding that credit cards don't charge interest if you pay off the entire balance within a month, correct?

i have two credit cards (barclay and cap one) and was thinking - what's to stop me from transferring the balance in full each month back and forth between the cards? (this is assuming i add no extra purchases).

i know there is something wrong with this idea... can anyone tell me what?!


-- i want to do this cos i am going to have trouble making payments this month and maybe next month too.

grumbler

Welcome to MSE!

bgmnt2000 wrote:

... what's to stop me from transferring the balance in full each month back and forth between the cards? (this is assuming i add no extra purchases).

i know there is something wrong with this idea... can anyone tell me what?

1. Balance transfer fee about 2%
2. Outside introductory 0% periods interest is charged on BTs from the date of transaction (the same as for cash advances).

Robert_Sterling_3

Don't do it and be a money saving expert instead.

jimclark1967

bgmnt2000 wrote:

it's my understanding that credit cards don't charge interest if you pay off the entire balance within a month, correct?

True, but only for purchases, not balance transfers otherwise everyone would be at it

JC

bgmnt2000

thanks for the quick replies..

but can't i go into a bank and say "i'd like to pay the balance of this bill" and hand over the over card to pay with? wouldn't that be a purchase?

[Deleted User]

Banks do not accept credit cards as a means of payment for another credit card. THis is not regarded as a purchase - but more like a cash advance for which there is a charge. It sounds like you have a lot to learn. Keep reading this site.

GlennTheBaker

bgmnt2000 wrote:

thanks for the quick replies..

but can't i go into a bank and say "i'd like to pay the balance of this bill" and hand over the over card to pay with? wouldn't that be a purchase?

No, it would be treated as a cash advance. You would be effectively drawing cash from one card to pay the other. Cash advances normally carry a fee such as 2% and interest is charged from the day you withdraw the cash. Often the interest rate is higher for cash advances than for purchases too so all in all, you'd end up in a right mess.

bgmnt2000

damned if i do, damned if i don't.

sounds like you have a lot to learn

sounds like i have a lot to earn - maybe i should google for "lotterywinningexpert"



but getting back to the topic - if i were willling to sacrifice the ensuing eccrument of interest could i balance transfer back and forth each month until i were able to start making decent payments again? i did this last month and managed to haggle a lower interest rate at the same time... i have read most of the relevant articles here but they mostly rely on getting a new card with a long term 0% but i can't apply for more cards right now.

i also read the credit card shuffle article but it's not entirely applicable to my current situation.

bob_builder_2

bgmnt2000 wrote:

but getting back to the topic - if i were willling to sacrifice the ensuing eccrument of interest could i balance transfer back and forth each month until i were able to start making decent payments again? i did this last month and managed to haggle a lower interest rate at the same time...

You could do this, but there would be no point unless you were transferring it to a card with a lower interest rate (as you already have done). Do not expect the companies to keep offereing lower and lower rates - they usually have only one offer rate at any one time.