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I never paid attention before.

July 3rd, 2006 at 04:44 am

When Citibank sends out those balance transfer checks, I put them in the 'pile of things to be shredded' because I don't have any room on the card anyway.

Today I was making an attempt at cleaning my room (I'm trying to declutter as much as possible) and went through the pile of 'things to be shredded', seperating out things that don't really need to be (envelopes and filler with no mention of my name or address) from things that definately were going to be shredded. I glance at everything when I do that, which is why it takes me so long sometimes to do anything. And noticed 2.99% APR until transferred balances are paid in full. Now I know that payments I make (were I to use the checks) would apply to the lower interest amounts before any higher interest amounts. Anyway...

I had this 'brilliant' idea. Now the checks I found have already expired, they seem to send them out rather frequently so I expect I either have some floating around that aren't expired yet or will be getting more soon. If I do, this is my idea.

My paid off Citibank card has a credit limit of $4600. Well ok, it's not completely paid off I have about $300 on it but that'll be gone soon enough. In about 3 months I'll have finished paying off my current medical bills, leaving me with an extra $100/mo to do whatever with. My stupid timeshare is currently at $7800 with no prepay penalty and I think about 14.9% interest.

I could write a balance transfer check for $4000, lowering my timeshare loan balance and potentially making it more appealing for a buyer (ie just have them pay the balance left on the timeshare loan or take over the payments). Before, when that card was max'd, the monthly payment was $100 give or take. It is more likely that it wouldn't sell right away and I'd have be able to cover both payments. I know I'm going to loose money on the timshare and I just want out as soon as possible. If it sold, then I'd have another $171 to throw at the credit card and get it paid off even faster. Even if it didn't sell and I was paying on both until the timeshare loan was paid off, I'd still be saving because a good chunk of it would be at a lower rate.

Of course all this depends on me actually having the balance transfer checks for that particular Citibank card when I get my medical bill paid off in a couple of months and that it's still at a much lower APR. But it's worth actually doing the math if it ever comes up.

2 Responses to “I never paid attention before.”

  1. dmontngrey Says:
    1151922940

    I love Citibank balance transfers. You can always log in to your account online and there is an option to see what balance transfers are currently available for you. Citibank can mail a check directly to you or pay whoever it is you want to pay off. I just did this with a couple of my Citibank cards and it was very easy to do. Just make sure you read the fine print to see if there are any additional fees!

  2. Money Talk$ Says:
    1152113046

    Exactly a lot of times there is a 3% transfer fee, and also make sure you do not miss a payment. Those low % transfer checks almost always have fine print that says it will revert to your current APR if you miss a payment. or make a late payment. Moving the money to a lower interest solution is usually beneficial unless the fees outweigh the savings.

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