balance transfer offer

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knasty

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Citi approved my limit increase so I will be taking their free money. Although a 2% fee wasn't mentioned and I won't do it unless its truly free as otherwise it's not much better than my mortgage.
 

JohnK

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Citi approved my limit increase so I will be taking their free money. Although a 2% fee wasn't mentioned and I won't do it unless its truly free as otherwise it's not much better than my mortgage.

Not all offers are the same.

Mine was 0% balance transfer for 6 months with 2% balance transfer fee. I am saving at least 7% interest so it's worthwhile.
 

Kimster

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Quite common for them to offer balance transfers on their LOC. It is usually 0% for 3 months (No BT Fee), 0%for 6 months (2% BT Fee) or 5.9% for 2 years - all at 80% of credit limit. I have had many instances in which I have taken up the 3 months offer, only to chuck it in an online savings account for interest.

I should confess, you have to be extra cautious to double confirm on any BT fee - as they conveniently forget to mention that often.

Also quite common to offer increased credit limits - all these calls seem to originate from Sydney however
 

jlien

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Interesting, I notice in my offers page on the citi website that I have the 6 month balance transfer offer available. I do not see mention of any 2% fee.
Contemplating taking this up, any other gotchas to be weary of?
 
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Kimster

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Balance Transfer for CC and Balance transfer on LOC are quite different. Guess you may need to check whether the "offer" you found is in the Lending section as opposed to CC section.
Interesting, I notice in my offers page on the citi website that I have the 6 month balance transfer offer available. I do not see mention of any 2% fee.
Contemplating taking this up, any other gotchas to be weary of?
 

jlien

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Balance Transfer for CC and Balance transfer on LOC are quite different. Guess you may need to check whether the "offer" you found is in the Lending section as opposed to CC section.

Just checked again, it's in the credit card section.
 

RAM

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Not all offers are the same.

Mine was 0% balance transfer for 6 months with 2% balance transfer fee. I am saving at least 7% interest so it's worthwhile.

Not sure your numbers add up. I may be wrong but here is how (finance background) I would interpret it.

A 2% balance transfer fee would be 2% of total balance, so transfer $5,000 then fee is $100.

But this fee has been charged over a 6 month deal for you, so it is an effective interest rate of 4% for those 6 months. (Ignore compounding impact)

7% interest rate on $5,000 for a year = $350, so for 6 months = $175
vs
0% interest for 6 months = $0
plus 2% of balance transfer amount fee (cost) = $100

Net Benefit = $75 over 6 months

If paying 7% PA it is a saving but not as great as you may have though, really just a 3%pa saving (7% -4%) vs 5% (7% - 2% implied) for 6 months, or you end up saving $75 interest over 6 months on a balance transfer of $5,000, or 1.5% of the balance transferred.

It is true - you can prove anything with figures..
You can confuse too unfortunately.
 

knasty

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Another example today of Citi having.an excellent product, so long as you don't actually have to deal with their backoffice. Lots of time and effort for little result.
 

casanovawa

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Yeah i saw that last night when i logged onto citibank and just for the heck of it checked out the offer page and saw the 0% for 6 months offer, was going to take out about 75% of my limit and whack it in my savings account earning 4%, got to the final stage to approve I wanted to do it then cancelled as I probably have a few purchases on there and thought I'd pay them down first and not put anything else on the card while I had the money outstanding so i'm not confusing purchases and balance transfers...

Then i read this today about the 2% fee for 6 months (unsure if the post above says this fee relates more to LOC's than CCs) but anyway don't think I saw anything about that on the offer page (and wouldn't take it out, I'd do the 3 month/no fee option instead if so) but will double check it again when i come to get them to send me the cheque... Later this year I'll have a mortgage and then can whack it in there and for future offers, have thought if I could get one or two cards and maybe have $30-50k sitting in the mortgage reducing it it might save a pretty penny and reduce the life of the mortgage by a bit...

I have hinted at this little trick (or straight out suggested I was thinking of trying it) to family at lunches and amazing how they sort of look like "Can you do that?!?!", then 20 minutes later they have completely forgotten it... :)

And when i took the Citi card out earlier this year and took up the balance transfer offer and put it in an interest earning account, I spoke to a Citi phone rep and very specifically asked what is the exact day that I need to have this paid back by to avoid interest starting to accrue, then set a reminder in the email system at work for a week before to make sure I didn't trip up...
 

JohnK

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Not sure your numbers add up. I may be wrong but here is how (finance background) I would interpret it.

A 2% balance transfer fee would be 2% of total balance, so transfer $5,000 then fee is $100.

....

It is true - you can prove anything with figures..
You can confuse too unfortunately.
Apologies for the confusion.

I was caught between a rock and a hard place and was going to take up Citibank's offer of 8.99% for up to 3 years. When I called I was offered the 0% balance transfer offer for 6 months with 2% balance transfer fee.

The decision was a no brainer. Saving at least 7% interest for 6 months on a significant amount.

And yesterday I called ANZ regarding their too good to be true offer. They have offered me 0% balance transfer for 16 months up to 95% available credit limit. Still have 6 months to go on old offer so will try to stretch that until 20 September.
 

jlien

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Logged into my account and noticed this today, found it amusing.

BT offer.jpg

Edit: how do I make uploaded pictures bigger?

Edit 2 : For those that cheekily ask for a credit limit increase prior to taking up the BT, how did they ask for it, did it process quickly & did they take a veda hit from it?
 
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Verde

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I think they must vary things somewhat. I went to cancel my citibank card a few months back and they gave me 2 years interest free with no BT charge and waived the next annual fee (so I'll pay it off in 18 months and cancel it just before it comes due again... possibly get another offer). No idea why they keep making me offers like that, I've paid no interest and had the card fee waived for the last few years now (though I did have about 3 years of 4.9% for the life of the BT before paying it off). The card has never had a purchase made on it in the several years I've had an account with them, I would have thought that would raise some kind of flag.

With a previous BT (not with this years), I went to use most of my credit limit but they insisted on increasing my limit so there was 20% available after the BT, so they just did that first and then processed the BT all in the one telephone call. I'm pretty sure they never reported it to Veda at the time (I think I got a report and it still had the original limit on it, not the newer one - they might not bother if it is only a few thousand).



Logged into my account and noticed this today, found it amusing.

View attachment 34255

Edit: how do I make uploaded pictures bigger?

Edit 2 : For those that cheekily ask for a credit limit increase prior to taking up the BT, how did they ask for it, did it process quickly & did they take a veda hit from it?
 

Kimster

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Hit and miss with Veda hit for credit limit increases !!. To be honest, it is expected with Citibank.
 

muffy28

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I received 2 offers and am thinking of getting the cheque to self and putting it into my home loan for 6 months. How does this deposit affect tax? Is it classed as income? Do you have to declare it at all? Thanks.
 

knasty

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Wasn't cheeky ;). I had previously dropped my credit limit to 1/3 of what they originally offered me. When I got the balance transfer offer by phone I asked them to call back in a week. I then rang and asked for a credit limit increase, telling them I had a substantial purchase coming up (which is true). They told me they could only do 50% unless they referred me for a full re-evaluation which I did, and still only got an additional 50%. maybe it has something to do with the NAB and ANZ cards I got in the meantime....

So I paid my account balance in full yesterday, put the cards in a safe place today, and completed the BT process this afternoon. Whilst I like this card a lot I'll use another not quite as good, for the saving of 4.5% on my mortgage offset...

Oh and for the 'substantial purchase' i will apply for the Westpac Altitude with 0% on purchases for 12 months and that will be my primary card for the next year.
 

knasty

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I received 2 offers and am thinking of getting the cheque to self and putting it into my home loan for 6 months. How does this deposit affect tax? Is it classed as income? Do you have to declare it at all? Thanks.

Not offering tax advice, but putting a capital amount on your loan (or in offset account) does not actually derive income so there should be no income tax liability.
 

o40ity

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Wasn't cheeky ;). I had previously dropped my credit limit to 1/3 of what they originally offered me. When I got the balance transfer offer by phone I asked them to call back in a week. I then rang and asked for a credit limit increase, telling them I had a substantial purchase coming up (which is true). They told me they could only do 50% unless they referred me for a full re-evaluation which I did, and still only got an additional 50%. maybe it has something to do with the NAB and ANZ cards I got in the meantime....

So I paid my account balance in full yesterday, put the cards in a safe place today, and completed the BT process this afternoon. Whilst I like this card a lot I'll use another not quite as good, for the saving of 4.5% on my mortgage offset...

Oh and for the 'substantial purchase' i will apply for the Westpac Altitude with 0% on purchases for 12 months and that will be my primary card for the next year.

Paid of my CC balance yesterday too, will process the Chq to self offer next week.
Did you have to paid a 2% BT fee like others have mentioned?
 

jlien

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Called up citi just then about a limit increase & balance transfer, unfortunately applicatin for a limit increase would require a review & take a few days, which I interpretted as a veda hit.
Decided to can the idea of the limit increase and took the BT at my current limit.

Cheque should arrive within the next 10 working days. Asked if they would just transfer the amount directly to my citibank plus account but they didn't have such facility available, apparently.
 

knasty

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Not necessarily a Veda hit - standard practice. There was no BT fee; completely free.
 
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