citi bank offers a 9 months 0% balance transfer. so if i take a 100K loan from wells fargo and put it into a cd account which they offer a 4.78% interest rate for 5 months. then i transfer the 100K to the citi bank account will i get no interest charge for 9 months? at the end of that period, i will have about 104k in the cd account, which i can take out 100k to pay back citi bank. does this work?
2007-08-06 11:06:29 · 7 answers · asked by KevinLT 1 in Business & Finance ➔ Personal Finance
It doesn't work because if you are borrowing from Wells Fargo to put loan proceeds into a CD that pays 4.78%, you are most definitely being charged more than 4.78% for that $100k loan.
If you were taking a cash advance from Citi (which they will charge you for even if there is a 0% apr on the interest), you can put those funds into a CD. But trust me, no CD is going to pay you the amount of return you need to cover cash advance fees or the interest on a bank loan.
2007-08-06 11:23:11 · answer #1 · answered by PK 5 · 0⤊ 0⤋
Probably not. I'd be real surprised if you have a limit over $100K on a Wells Fargo credit card that you could take the cash advance on. The Citi offer is only good for transfer of credit card balances, not other loans.
Plus I'd read the terms on the Citibank offer very closely, to see if there are limits or not on what can be transferred, and what fees are charged for the balance transfer.
2007-08-06 18:35:47 · answer #2 · answered by Judy 7 · 0⤊ 0⤋
Yes, but remember, most balance transfers have a transaction fee. So as long as the transaction fee (which can be a flat fee or a percentage of the transfer) is less than the amount you would get in interest from the CD, you should be making a nice little profit. Also look at closing costs and fees on the loan.
2007-08-06 18:09:39 · answer #3 · answered by sam l 3 · 0⤊ 1⤋
Do you honestly believe these companies would make the offers if the ALL didn't profit off of them? Since the source of the profit in ALL cases is YOU, I guarantee, you will lose money somewhere on the deal. I am too lazy to bother finding out where.
2007-08-06 18:34:50 · answer #4 · answered by STEVEN F 7 · 0⤊ 0⤋
I'm not sure of the terms of the wellsfargo loan but I am sure it will not be worth what taking the loan from wellsfargo will cost you. Also there may be fees involved with both the wellsfargo loan and the balance transfer.
2007-08-06 18:14:17 · answer #5 · answered by amh 1 · 1⤊ 0⤋
Yes...
Just read the fine print. make sure there's no charge to initiate the loan from your credit card. (sometimes there's a fee up to 3% or so). Also, you would need a large enough credit limit to make the loan.
If all that's true, you can make a nice little profit.
Good Luck
2007-08-06 18:09:01 · answer #6 · answered by Michael K 5 · 0⤊ 1⤋
NNNNNNNNNNNNNNNNNNNNNNNNNNNOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! look at the transfer fees, also there are still monthly payments with the transfer which takes away from your 100k CD, and if you go past the due date they will kick in a high interest rate (19 to about 25%).
2007-08-06 18:31:28 · answer #7 · answered by frfiter 3 · 1⤊ 0⤋