Making money from money transfer

sdd56

I currently have a 0% offer on my credit card of a money transfer (direct into my bank account).

The fee is 2.6%, and the 0% lasts for 20 months.

The card balance is currently zero, and I don't use it for spending.

I've worked out that if  I transfer 10K into my savings account (currently 2.75%), and pay the minimum each month, I will make about £90 profit at current interest rates.

Obviously more if rates increase.

This seems too simple - am I missing something here?

dil1976

If someone told you to bet £10,000 to win £90 would you do it?

grumbler

sdd56 said:

This seems too simple - am I missing something here?

No. There is even a subboard here -

Stoozing: free cash from credit cards  Discuss the art of making money by earning interest on cash that credit cards lend you at 0%.

However, if 2.75% is a flexible rate, it can drop as well as increase. Possibly, it's worth considering some fixed rate savings account for this. And it's advised the payments to be slightly more than minimum.

cymruchris

dil1976 said:

If someone told you to bet £10,000 to win £90 would you do it?

What does that have to do with the price of fish?

The OP isn't talking about gambling.

The money transfer is zero interest with a certain percentage fee - and the savings account is a percentage fee - and they are asking whether their calculations are correct. Not sure where placing a bet comes into it. 

To the OP - assuming you have the credit limit - the fee as described - pay the required payments on time - then yes you'd make a profit based on the figures quoted, although someone better at calculating it to the penny than me can confirm if your estimate is correct.

dil1976

cymruchris said:

dil1976 said:

If someone told you to bet £10,000 to win £90 would you do it?

What does that have to do with the price of fish?

The OP isn't talking about gambling.

Well the bank account could get closed, the bank could go bust, the OPs circumstances could change and cant afford the repayments which could lead to a loss. So it has plenty to do with it what has been asked.

grumbler

dil1976 said:

cymruchris said:

dil1976 said:

If someone told you to bet £10,000 to win £90 would you do it?

What does that have to do with the price of fish?

The OP isn't talking about gambling.

Well the bank account could get closed,

Well, open a new one or pay the CC off. The maximum you can lose is the transfer fee, not £10K.

the bank could go bust,

And? The last time I checked there was up to £85K FSCS protection in place.

 the OPs circumstances could change and cant afford the repayments which could lead to a loss.

What about £10K in the savings account?

 So it has plenty to do with it what has been asked.

Not really.

cymruchris

dil1976 said:

cymruchris said:

dil1976 said:

If someone told you to bet £10,000 to win £90 would you do it?

What does that have to do with the price of fish?

The OP isn't talking about gambling.

Well the bank account could get closed, the bank could go bust, the OPs circumstances could change and cant afford the repayments which could lead to a loss. So it has plenty to do with it what has been asked.

I wouldn't say 'plenty' - more like remotely possible at an extreme. 

The OP would still have the capital in the savings account to pay off the credit card immediately if needed.

The bank is unlikely to close their bank account unless they are doing shady deals on the side.

The likelihood of a bank going bust is slim, but covered under government guarantees.

The world could end tomorrow.

The price of custard creams might reach a £1 a packet a week Thursday.

So I'm not convinced that what you've said has 'plenty to do with what has been asked'. 

pecunianonolet

Right, this should be in the sub forum but here is what I did today after so many products got pulled yesterday.

MBNA offering me 2 money transfer options. A transfer for a small fee but at zero interest or a fee free option but with 4% interest over 36 months. I have  still a bit of debit there from the past I melt down with minimum payments at 0%. Obviously, I go for the fee free option because no interest is paid because I balance out straight after the cash is in my account.

So today I applied for the 21 months, interest and fee free Santander balance transfer card. Limit I got was decent but not high enough. Ca 30 min after Santander application I applied for a Sainsbury card, again interest and fee free but only got 14 months but with a decent credit. 

Once I have both accounts open I max out the MBNA card and take all the cash they allow me to take (Sainsbury and Santander cards together have higher transfer limits as I can possibly withdraw from MBNA).

I will max out the Sainsbury card and all remaining I transfer to Santander. For Sainsbury transfers are only fee free in the first 60 or 90 days (can't remember) and on the Santander card I can make unlimited transfers over the full 21 month period fee free.

So, minimum payment to Sainsbury and minimum payment to Santander. After 14 months I pay off the Sainsbury card by transferring the balance to Santander and melt that down for another 7 months. This gives me a lower 5 figure sum of cash interest free to put into savings. First, all cash goes into the 2.75% esaver and after all announcements and BOE statement I will decide if I fix for 12 months or keep it afloat, albeit to a lower rate, in easy access savings and move other cash savings into a cash ISA. 

I am a higher rate tax payer so need to make sure I watch interest and tax so I not stooze for the government cashing in 40% for all above my £500 limit.