Why don't more people use those low interest C.C. purchase checks to pay off their balance?

Question

I am talking about all one card. Assuming one has the credit limit to do so. Say, one has a $5,000 C.C. debt with a %12 APR and a $15,000 credit limit and they are given purchase checks with a fixed 7% APR (which many c.c. companys do). I know they forbid you from using those to pay balances from the same company that issued them, but why not just use one of those purchase checks to write $5,000 cash to yourself, put that money in your checking account. Then, write a regular check to pay off that higher $5,000 APR on your credit card so that you are left with $5,000 debt at 7% rather than $5000 debt at 12%

Answer 1

cc companies may be dumb but they are not stupid -- try it and you will see on your next bill where you took out a 5000 cash advance and what is the interest and fees on cash advance -- if you want a free lunch go to the salvation army!!!

Answer 2

Why not? I was just given checks at a guaranteed 3% for the life of the debt and was thinking of paying off my car note. The only problem I can see is that I had a credit card with a very low rate of interest and was using it rather than getting loans. One day I received a letter saying that in a month my interest rate would be going up 5%. Of course, if I closed my account I could have kept the low rate until my balance was paid off. And then if you make a late payment, they can really raise the rates. There is also a credit card that is currently offering 0 interest for 12 months on all balances and also just charged a 3% balance transfer with no interest due for a year on that amount. Why aren't people using this card.? I am.

Answer 3

If you write one of those balance transfer checks to yourself, the CC company will charge you the Cash Advance Rate, not the special Balance Transfer Rate. So you couldn't do what you suggest. I tried it myself, and that's exactly what happened.

I have cards from different CC companies and balance transferred between them into rates that are good for the life of the balance. Something I unfortunately need, since I won't be able to pay them off anytime soon. :-(