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30 Nov 2009
I have a Capital One Visa card that I haven't used in a long time. Every few months they send me cash advance checks, and I can see their increasing desperation as the terms of the checks keep getting better. The usual deal is a 2% or 3% transaction fee when you write the check, then they charge interest starting the day you write the check at a rate which on my account would be 24.9%. These are such an awful deal that rather than dropping them in the recycling bin at the post office, I bring them home and shred them. A few months ago they started sending checks offering no transaction fees, which improved them them to merely undesirable, but a few weeks ago they sent me a set with no fees and small print on the back of the letter saying they "Are treated as purchases according to the terms and amendments of your Customer Agreement." Hmmn.
My customer agreement, like nearly everyone else's, say that there's a grace period for purchases, so if I pay my bill within 20 days after they send it, there's no interest charge. This seemed a little too good to be true, so I called them up and asked whether there was a grace period (yes), how much interest they would charge if I paid within the grace period (none), and just to confirm, she said there was a grace period just like a purchase with no interest due if I paid on time (yes.)
Well, in that case, that means they're free money, so I wrote myself a check for $10,000 and deposited it in my bank's high interest on-line savings account, which happens to be the account I can use to to pay the credit card bill on-line. (I can't deposit checks over the counter to the on-line account, but deposits in the ATM in the lobby are OK. Go figure.) I'll wait for the $10,000 to show up on the next bill, point 'n' click to pay the bill on the due date, leaving a month's interest in my account. High interest these days is only 1.35%, but that's still about ten bucks a month, and maybe this will get Capital One to stop sending me the blasted things.
The day after the deposit, the $10K showed up in my bank account. The day after that Capital One emailed me to tell me my balance transfer had been approved. That was a bit strange, but a quick look at their web site confirmed that the $10K had been posted as a purchase check, and so far no interest.
They should bill me on Dec 11th, so assuming the no-interest claims were true, I'll deposit the next $10K the day after that. Check back for updates then.
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