Cash Advances from Credit Cards

[kristo]

I need help from you clever informed souls with this matter.
Even though I rarely do it I have a need in future to obtain a $25,000 cash advance from a branch of a major bank.
The cheapest credit card for this type of transaction seems to be a Westpac card.
Westpac charge a Cash advance transaction fee of 1.5% Max $50.
However , Citibank charge 2.7% No Max which on $25000 would be $675.
Westpac charge the fee on the "Current" balance, that is the balance taking into account uncleared funds as not part of the balance.
Does anyone know of another bank which uses the "Actual Balance" ,
that means they include the uncleared funds.
Or, alternatively a better method of getting a cash advance using credit card.

 

[Rick93]

If you are asking "What type of credit card should I use....?"
Then, I assume, that you haven't actually got an account yet. So, if you are going to go through the effort of applying for a credit card (say, about 4 -6 weeks from application to receiving card), then wouldn't you be far better off getting a 'personal loan'???

The interest rate will be far less, plus you probably won't come up against the "Do you earn over $100,000. pa?" question, in order to get a $25,000. plus credit limit.

I'm sure others will agree with me.....

All the best,
regards.....

 

[kristo]

Cash Advance from Credit Cards

Thanks for you reply.

I do not plan to pay any interest at all.

I will deposit a cheque equivalent to the Cash advance at the same time I get the advance.

My question is designed to reduce or eliminate the admin fee for a cash advance which ranges from $50 to $675.

Any ideas?

 

[Rick93]

ERROR

 

[Rick93]

Kristo,

Unless I'm really mistaken....
There is no 'interest free' period for cash advances from ANY credit card.... only for merchant purchases.

Further, you won't get any points for a cash advance.... no matter how large. Points are only awarded for merchant purchases.

I would do a bit more reseach into your requirements. I still think a personal loan will be best for you....

regards,

 

[kristo]

Thanks for the reply, Gordon.

If one deposits an amount ( in cheque form) equivalent or greater than the cash advance amount at the same time or prior to the cash advance you effectively either put the card in Credit or a least even after the cash advance and will not then pay any interest as the card has no debit balance to charge the interest on.

But this is not my worry, its the cash advance admin fee I am trying to avoid.

 

[oz_mark]

The only reason I can see for wanting to do this is so that you can access the funds straight away, without waiting for the funds to clear. If this were the case, there are probably other options available.

 

[Rick93]

Sorry Kristo, but I think you are somewhat misinformed about this. No bank is going to carry out that type of transaction for 'free'.

You will still be charged a fee of some type.

If you were to deposit a cheque into a credit card account, it would still take a good three to five working days to clear. If you pulled out any cash advance from the account BEFORE the cheque cleared..... you would be hit with the full cash advance fee, plus I reckon they'd charge you interest from the second you drew down on the funds! Also, you would need to do it at a branch, not an ATM, so there would be a 'teller assist' fee. (even if it's only $3.00)

But why do you want to do this for?

As I stated previously, there will be NO POINTS awarded for such a transaction. If you have the funds in a "cheque", then what's the idea behind this transaction?

Please explain a little to us all. If you have an idea... I'm sure we would all like to hear about it. We will, of course, evaluate any idea or plan ourselves.... because each of us have our own unique financial situation etc.

So, Kristo..... we await your reply.
THANKS....

 

[kawoh]

advances

you will earn points with Diners Club for a cash advance, but this is a charge card, so i'm unsure if you even allowed a credit balance - what happens with this.

Diners charge 4% for a cash advance, but you earn 1 point for every dollar, or for those lucky enough who are earning 1.5 points per dollar, then 1.5 points for the pleasure of a 4% cash advance amount.

Also, as stated earlier, no bank will clear your cheque immediately and you'll need to allow 3-5 business days, in westpac's case (i've deposited cheques there previously), expected the FULL 5 business days, and perhaps even an extra day if you do if on a friday.

If you want to avoid these 1.5% etc cash advance fees, consider a card without a rewards program, flat fee cash advance credit card providers include - St George and Members Equity. I'm sure there are a few others out there as well. I regularly use these when travelling overseas for the easy access to cash, competitive rate and the low overseas cash advance fee ($4.00), locally the cash advance fee is $1.50, flat rate.

 

[kristo]

The reasons for the transaction are not relevant, but to save time here goes. When I buy cars I go to an Auction where the dealers buy their stock so I can buy the car for the same price as a dealer.
The auction establishment eg Pickles, only accepts cash or Bank Cheque and you must settle in 24 hours or so or forfit a $500 deposit.

Once you have bid and paid the deposit on a car you then go to the bank with your personal cheque for, as an example $25,000.

You deposit this cheque to your Credit Card, which should have no purshases on it, as they would apply the cheque to purchases first.

You then get your cash advance for say $25,000 and either buy a bank cheque or take the cash and buy the car.

I have confirmed this and done it many times in the past, as your card does not go into debit there is NO interest.

The purpose of this post as I mentioned in my first post is to establish how to avoid the Cash Advance Administration fee which ranges from $50 with Westpac to $675 or whatever with Diners/Citibank.

As I may have said before Banks claim they are for people not Profit.
I claim they are for my profit and not someone elses so I will investigate any way to avoid paying fees to a bank.

So there it is and back to my original post, any suggestions on how to avoid this fee.

 

[arun]

Kristo,
You have explained well as to what you are doing. But, why? What benefits will you get by channelling it through the credit card instead of taking a bank cheque out of your cash in the bank account?
As someone said, if there is a benefit (like extra points, etc), I would love to know, so that if it suits me, I can follow.
Regards
Arun

 

[kristo]

Interesting question.
Would a major bank like Westpac cash a cheque for $25,000 drawn on an AMP Bank or Citibank account?

 

[Rick93]

Thanks for your reply Kristo, but just as side issue.....
If you buy a car at a Saturday auction, and you don't have a lazy $25,000. or so in your back pocket, then how does the auction house expect you to get a bank cheque in less than 24 hours?

I'm still thinking over why and how you do what you do.....

regards,

 

[kristo]

Professionals in the industry and people who know car prices do not buy cars on weekends thats when they sell them.
They buy them on Monday for say $20,000 at an auction etc, wash them and sell them on Saturday for $25,000.

 

[Rick93]

O.K. !

That just about covers it! .....

All the best...