Credit Card Benefits 10 Reasons to Love Your Credit Card Bank by Scott Bilker

Call me an extremist. A few issues ago I wrote to you with “10 Reasons You Should Hate Your Credit Card Bank”. In this issue I will point out the other side. Boy, the banks are going to love me for this; too bad they won’t be sending me a check!

Love ’em, hate ’em, it’s the same old story. Credit cards themselves are not bad. There are advantages and disadvantages. This time I want to take a look at some of those advantages…

By the way, please take the survey when you’re finished–thanks!

1. Access to money By being able to use your credit card you can actually save money! Here’s an example from my personal life. My dentist gives a 5% discount if you pay at the time of service. Because I can pay with my credit card I get the 5%. Even if I paid interest on this amount, at 10% APR I can still take 6 months to pay it back and break even!

2. Protection from merchants When you buy stuff with your credit card you are very protected. For example, if a merchant won’t give you a refund for a return you can always contact your credit card bank and dispute the charge. The bank will probably decide in your favor and chargeback the merchant. The merchant would have to take you to court to fight further. On the other hand, if you paid cash instead of using your credit you would have to pursue the matter in court with the merchant.

3. A chance to build a positive credit history. You must have a good credit history in today’s society. Many people look at your credit report to judge you so it’s vital that your report is the best it can be! Potential employers, insurance companies, mortgage companies, and many more will try to get an idea of your character from looking at this information. Having a credit card and using it wisely will help create that positive history.

4. Other perks and cash back rewards There are many cards that actually pay you to use them. They provide a cash-back bonus or other reward. If you can take advantage of that reward then you can actually save money.

5. Warranty protection Some credit cards will extend the warranty of an item purchased with that card. Contact your credit card companies to learn about these benefits so you know which card to use when purchasing that new computer.

6. Money in an emergency If your car breaks down late at night you may not be able to get an ATM machine or your personal bank. However, by having a credit card you’ll have access to the money you’ll need in these tense situations.

7. Better deals than other loans So many banks, so few good customers. They are fighting for our business! You may be able to get better rates from your credit card bank than from a personal loan or auto loan. Right now I have four, count ’em, four banks that are offering me 0% until near the end of this year!

8. No chance of losing cash If you lose your wallet you’ve lost your cash. If you have $100 in there, it’s gone. If you carry little cash and use credit, then, if you ever lose it you can call the credit card bank and report the card lost and you won’t owe a dime. The bank loses the money, not you, HA HA!

9. Better than a debit card If someone steals your debit card information they may be able to steal money from your accounts. If that happens, your checks will bounce and you’ll have to deal with each place you wrote a check too plus the bouncing fees from your bank. You’ll have to fight to get your money back. If someone steals your credit card then you would call the credit card bank and tell them cancel the account and you wouldn’t be responsible for the charges that you didn’t make. That’s the risk banks take for the profit they make. Hey, that rhymes.

10. Customer service 24/7 Most credit card banks have reps there 24/7. That’s great because you can deal with them at your convenience. If you pay your bill late Thursday night, and you have a question, you can talk to someone. Granted that you’ll be dealing with their voice menu for a while before you speak to a human, but you will eventually speak to one. 🙂…

Advanced Cash Advance Techniques by Scott Bilker

Dear Scott, I recently read your article about buying a card with a card. I have a 0% interest card and plenty of balance so it seems like a good idea. Problem is the seller is a private party. Obviously I can’t use a convenience check or a cash advance or I’ll blow the interest strategy. Is there a way to pay a private party so that it appears as a purchase on the card and not an advance? I have checked out PayPal but I’m not sure the seller is Internet active. Thanks.

Note: Everything I suggest in this response is what I would do. You must be careful to analyze your specific situation to be sure that it will work in your benefit.

Glad to hear the you read my article, Consider Financing Your Next Car with a Credit Card!

It’s great that you have a 0% deal on your credit card. I’ve used these deals in the past to purchase a few vehicles. Actually, it may not be such a problem that you seller is a private party. It’s the same problem that you may face at a dealership.

Dealership say they accept credit card payments however, many will not let you purchase the entire car with your credit card. They’ll allow you to put your down payment on the credit card but not the entire amount. This is because they don’t want to pay the merchant fees for accepting the card. These fees are probably at least 2%. Therefore, a dealer would also ask you to use a personal check or bank check.

You need to find out if your 0% deal is good for cash advances. I’m guess that this may not be the case or else you wouldn’t be asking, nevertheless, you should give your credit card bank a call and tell them that you’ll write yourself a check, and deposit it in your account, as long as it’s at the 0% rate.

If that doesn’t work then ask them if they would give you that 0% rate if they, the bank, did a direct deposit into your checking, or savings, account. The key is to get that money in your account at the 0% rate, preferably without any cash advance fees, then use that money to write a bank-check to car seller.

Say it’s the case that they still will not do this. They would probably entertain the idea of your transferring the balance from another card at the 0% rate, this way it’s not a cash advance. Then, check with you other credit cards to find out if you can get a cash advance, with no fees. If so, you can write a check with the second card, deposit it into your account, buy the car, then immediately call the 0% bank and do a balance transfer. When the smoke clears you’ll have that car at 0%.

You just need to do one more thing which, is to mark your calendar as to when the 0% deal expires. You must be sure to pay that off before they hike your interest rate. Also, don’t be late paying on that 0% deal! It’s probably true that the offering bank will slap you with a crazy-high interest rate as a penalty. I’ve seen some as high as 26% for late payers.

Good luck and please let me know what happens!

Regards, Scott…