Slate: A New 0% Credit Card from Chase

The government continues to report positive macroeconomic news. Yesterday, the Institute for Supply Management (ISM) released its Purchasing Manager's Index (PMI) for October 2009. The PMI came in at 55.7%, better than what Wall Street economists were expecting, and better than the September figure. For the PMI, any figure above 50% is a strong indication that the American manufacturing sector is expanding.

Though an economic recovery appears to be taking hold, too many Americans are still dealing with various forms of oppressive debt, a home mortgage balance that's higher than their home's value, and job insecurity. In fact, earlier today Johnson & Johnson, a component of the Dow Jones Industrial Average (DJIA) and number 29 on the Fortune 500, announced that the company will be cutting 7,000 jobs (that's between 6% - 7% of its workforce.) National unemployment, already at 9.8%, will almost certainly rise during the fourth quarter and into Q1 2010. A jobless economic recovery? Yes: we're in it right now.

The whole world is relieved that the subprime debt-inspired credit crisis, which precipitated the worst recession since the early 1980's, and which brought the American financial system to its knees, has almost run its course. The liquidity maelstrom of 2008 and 2009 prompted the banks which survived the subprime debacle to cutback on all kinds of loans, including credit cards.

But financial markets are on the mend, as evidenced by low LIBOR rates, a healthy TED spread and the return of generous 0% intro APR credit cards.

Credit cards that offer a 0% intro APR period of at least 12 months all but disappeared from the market last year. But they're back. JPMorgan Chase Bank, commonly known simply as Chase, recently revealed a new credit card called Slate. Here are the vitals on Slate:

• 0% introductory APR on purchases for 12 billing cycles
  
  
• 0% introductory APR on transferred balances for 12 billing cycles
  
  
• Balance transfer fee of 3% of each transaction, with a minimum of $5
  
  
• NB: The 0% intro APR is reserved for those who qualify for "Elite" or "Premium" pricing. Those who can only qualify for "Standard" pricing cannot take advantage of any interest-free introductory period with this particular card.
  
  
• For those who qualify for Elite pricing, the "goto" rate (also known as the ongoing rate) is 13.24% (the U.S. Prime Rate plus 9.99%); for Premium pricing it's 17.24% (Prime plus 13.99%.) For Standard pricing, the introductory and goto rate is 22.24% (Prime plus 18.99%.)
  

If you have a good FICO® credit score (above 700), you will probably qualify for either Elite or Premium pricing.

Slate is a very timely credit card: it has arrived in time for the fast approaching Christmas shopping season. With Slate, cardholders can do their holiday shopping and have plenty of time (12 billing cycles) to pay their credit card balance down to zero without having to worry about interest charges.

The goto rate with the Slate card, however, is relatively high when compared to consumer-friendly credit card offers that were available before the global credit crisis (likely a direct result of new rules included in the Credit Card Act of 2009.) For the consummate borrower who qualifies for Elite pricing, the rate charged on any balance remaining after the interest-free, introductory period ends is Prime (currently 3.25%) plus 9.99%, which translates to 13.24%.

But the U.S. Prime Rate is as low as it can possibly go. As the economy heats up, it will certainly rises, and it will likely do so at a relatively fast clip as the Fed works to contain future inflation. There is no way of knowing exactly how high the Prime Rate will be a year from now, but if we plug in the median U.S. Prime Rate -- 8.75% -- then we get a rate of 18.74%, which anyone would agree is not consumer-friendly. In fact, any rate above 15% would be too much of a financial burden for the typical credit card consumer.

That's why we recommend Slate for anyone who can pay their balance down to zero over 12 months or so, which shouldn't be that hard to do (no need to go crazy with the Christmas shopping!)

As always, your comments are welcome and appreciated.

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New Card Added: The Home Advantage World MasterCard

Recently added a new Bank of America card: The Home Advantage World MasterCard® with WorldPoints® Rewards. This card is similar to the Citi® Home Rebate Platinum Select® MasterCard in that accumulated rewards dollars are used to pay down a cardholder's mortgage balance.

I like these two cards. As long as the cardholder can pay his or her entire balance in full at the end of each month, these cards can really help homeowners improve their mortgage situation and, by extension, their finances in general. By paying down a mortgage balance with extra payments, or in this case with accumulated rewards dollars, homeowners can:

• Build home equity faster. This is crucial in the current U.S. real estate environment. The more equity you have in your home, the less likely you are to run into problems if at some point you want to sell, refinance, or get a second mortgage (a home equity loan or a home equity line of credit.) FYI: a number of experts have recently predicted that the American real estate environment won't improve until 2009.
  
  
• Lower the total amount of interest that will be paid on the loan. If you take the example of a $250,000 mortgage with a 30 year term and a typical interest rate, the savings can be in the many thousands of dollars. It's amazing how these things add up over time!
  
  
• Payoff a mortgage faster. This is optimal for anyone with a mortgage, but especially optimal for homeowners who plan on using the equity in their home to help fund retirement.
  

Currently, the fee for transferring credit card balances to the Bank of America Home Advantage MasterCard is 3%, with a minimum of $10 and no maximum. However, the card offers a 12 month, 0% Introductory Annual Percentage Rate (APR) on Balance Transfers and Cash Advance Checks.

With the Citi® Home Rebate card, you can transfer credit card balances at 0% Intro APR for 12 months, and, currently, you don't have to pay a balance transfer fee for the initial balance transfer.

Enjoy!

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New Card Added: The Clear from American Express Card

We've recently added a new credit card to the list of American Express credit cards we recommend here at BalanceTransfer.cc. It's the Clear from American Express® card, and it offers 0% Intro APR on new credit card purchases for 12 months. The APR for balance transfers is 4.99%, with no balance transfer fee.

Yup, it would be great if you could transfer balances to Amex Clear at 0%, but 4.99% isn't that bad, considering the fact that it's 4.99% for the life of the transferred balance. Right now, the U.S. Prime Rate is 8.25%, so transferring a balance to this card can save a lot of people out there some serious cash (the APR for many credit cards in the American market is the U.S. Prime Rate plus a margin.)

The main selling point of this card is that there are no fees: no over-the-limit fees, no annual fee, no late fees, no balance transfer fees and no cash advance fees. As quoted from the American Express website:

"No fees of any kind."

However, if you are the type of person who pays their bills on time, all the time, then this "no fees" marketing strategy is almost meaningless, since a person like you is very likely to avoid such fees in first place. Of course, if you are the sort who sometimes misses a payment, or you go over your credit limit every once in a while, then you may be very attracted to the fact that the Clear card has no fees.

Though American Express won't charge you any fees for a late payment, they will report any late payments to the credit bureaus. Keep that in mind. Furthermore, if you are late with a payment more than once within a 12 month period, the folks at Amex may raise the APR associated with your account.

Another characteristic about the Clear card that should be noted: every year, you get access to a "user-friendly" credit report and credit score. A great feature -- no doubt -- but I failed to find out which credit score and credit report they're offering: is it TransUnion, Experian or Equifax? Or is it some other proprietary credit score and report? Hmmmmm... Please post a comment if you know that answer. Thanks!

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New Offer Added: The Pulaski Bank Visa Gold Card

0% Intro APR balance transfer deals are great, but feeless (as in no transaction fee for transferring credit card balances) zero percent deals are even better -- much better! If you are partial to no-fee, zero percent intro APR offers, then we have some great news for you: we've researched and reviewed the Pulaski Bank Visa Gold Card, and added it as a recommended credit card here www.BalanceTransfer.cc. Key benefits:

• 0% Intro APR on transferred balances for 6 billing periods
  
  
• No balance transfer fee
  
  
• No annual membership fee
  
  
• A very competitive "go to" rate (FYI: the go to rate is the credit card's annual percentage rate that takes effect once the interest-free period ends.)

It would nice if the zero percent intro APR feature associated with the Pulaski Bank Visa Gold Card included new purchases (à la the Discover Platinum card and the American Express INSIDE Rewards cards, et al.), but it doesn't.

However, it's important to note that the current "go to" rate with this card is highly competitive at 9.5% -- that's a mere 1.25% above the current U.S. Prime Rate. Compare the Pulaski Visa Gold's go to rate to this website's #1 choice: the Discover Platinum card, which has a go to rate as low as 10.99%.

If you decide to signup for the Pulaski Bank Visa Gold Card -- or if you already have one in your purse / wallet -- please feel free to post a review of the card by clicking the "comments" link below. Thanks!

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New Offer Added: The GM Flexible Earnings Card

We recently examined the terms and conditions associated with the GM Flexible Earnings Card, and decided that -- with the card's current features and benefits -- it deserves to be recommended here at www.BalanceTransfer.cc.

You'll have to pay a fee for transferring balances to the GM Flexible Earnings Card (also known as the GM Flex Card):

...3% ($15 minimum/$75 maximum) for advances by Balance Transfer Checks included in your Welcome Package; thereafter, 3% ($15 minimum) will apply, unless otherwise disclosed...

but on the positive side, it has some great benefits, including:

• 0% Intro APR on new purchases and transferred balances for 12 billing cycles
  
  
• No annual membership fee
  
  
• Attractive rewards:
  
  

  ...earn 1% cash back on every single credit card purchase, 1% toward any vehicle or a full 3% toward a brand new, eligible GM car, truck or SUV...

Click here for the GM Flexible Earnings Card.

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0% Intro APR Balance Transfer Credit Cards from American Express -- and You Won't Have to Pay A Balance Transfer Fee

Here at www.BalanceTransfer.cc, we are constantly on the lookout for the best 0% credit card deals. We live and breath credit card balance transfers, for the simple reason that 0% introductory annual percentage rate (APR) credit cards are, quite easily, the most consumer-friendly financial tools available today.

Allow me to present the anatomy of the perfect 0% intro APR credit card offer -- in my humble opinion, of course. Here are the attributes:

• 0% Intro APR on both transferred balances and new credit card purchases for at least 6 months
  
  
• No balance transfer fee for the initial balance transfer(s).
  
  
• No annual membership fee
  
  
• A competitive "go to" rate (FYI: the go to rate is the credit card's annual percentage rate that kicks in once the interest-free period ends.)
  
  

Right now, the best 0% credit card is the Discover Platinum card, a card that -- believe it or not -- meets all of the above-listed requirements! Citibank (Citi) also has 2 excellent credit cards that meet all of the above, except that they don't offer a 0% intro APR on new credit card purchases (click here for more info.)


American Express® Now Has Three, 0% Credit Cards That Are..."Perfect"

Some exciting news for credit card balance transfer fans all across the country: American Express has a new set of consumer credit cards that qualify as "perfect 0% credit cards" -- perfect by my definition anyway -- and these cards offer rewards to boot. They are the American Express INSIDE Rewards cards. Details below:

• IN:LA Card from American Express
  
  
  • 0% Intro APR on transferred balances AND new credit card purchases for 6 months
    
    
  • no balance transfer fee for the initial balance transfer(s).
    
    
  • no annual membership fee
    
    
  • competitive "go to" rate (factors including your credit rating will determine how low your go to APR will be)
  
  
• IN:CHICAGO Card from American Express
  
  
  • same benefits as the IN:LA card above
  
  
• IN:NYC Card from American Express
  
  
  • same benefits as the IN:LA card above

Of course, it's always important to remember that the terms, conditions, features and benefits of the credit cards we recommend at this website and blog are not set in stone, and therefore can change at any time. So if you plan on taking advantage of any credit card offer recommended here, try not to procrastinate.

Looks like the competition among the major credit card companies is heating up. Let's hope the trend continues!

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The Reason Why The Discover Platinum Credit Card Is Very Popular for Transferring Balances

Lately, I've been getting emails from folks asking why the Discover Platinum credit cards are so popular for balance transfers. Why do savvy consumers chose Discover over the competitors?

Well, folks, it's really quite simple: Discover offers the best value.

The Discover Platinum Card offers an interest-free period of 12 months for both transferred balances and new credit card purchases. Generally speaking, other credit cards typically only offer an interest-free period for balance transfers, and charge interest on new purchases.

Discover Platinum is also a rewards credit card: icing on the cake!

Last, but certainly not least: there's no annual membership fee with the Discover Platinum card.

NB: The Discover Platinum Card used to be a "no balance transfer fee" card, but you'll have to pay a fee for transferring balances now: 3% for each balance transfer, with a minimum of $10 and a maximum of $75.

We like the following 3 flavors of the Discover Platinum Card (Update: "Discover Platinum" has been renamed to "Discover More"):

• Discover® More Card- American Flag
  
  
• Discover® More Card
  
  
• Discover® More Card - Wildlife Collection
  

OK, now I know that for some of you, the next question is:

"What if I've already transferred my credit card balance(s) to a Discover account? I know I can't transfer from one Discover credit card to another, so what to do? I want a first-class, fee-free balance transfer offer, and I won't settle for anything less!"

If the above describes your situation, then we have good news for you: Right now, there are two Citibank credit cards that offer a 12 month, interest-free period on transferred balances with no balance transfer fee. The tw0 cards are:

• Citi® Driver's Edge® Platinum Select ® Card
  -- 0% APR on transferred balances for 1 year
  -- no balance transfer fee
  -- no annual membership fee
  
  
• Citi® Home Rebate Platinum Select® MasterCard®
  -- 0% APR on transferred balances for 1 year
  -- no balance transfer fee
  -- no annual membership fee
  

Remember: the interest-free period for the above-listed Citibank credit cards is for transferred balances only, not for new purchases, so you'll have to stay disciplined if you signup for one of these offers.

It's also important to remember that credit card offers can change at any time, so if you plan on taking advantage of any offer recommended here today, you shouldn't procrastinate.


Free Balance Transfer Update #1: Click here for more free (no-fee) 0% Intro APR Balance Transfer Offers.

Free Balance Transfer Update #2: Free (as in no fee) for transferring balances to the Pulaski Bank Visa Gold Card.


Before you go, please vote in the credit card balance transfer online poll. Thanks!

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What Is Going On with Bank of America's Credit Cards?

People are starting to wonder about Bank of America, specifically Bank of America's credit card offerings. For some time now, I've been reading lots of posts about MBNA's poor customer support and questionable tactics, and I wasn't a bit surprised to eventually find that thousands of MBNA credit card holders had started paying off their entire credit card balances and closing their accounts in order to permanently sever their relationship with MBNA. MBNA's profits were hit hard by the exodus, leaving MBNA primed for a takeover, and that's exactly what happened: Bank of America purchased MBNA a few months ago; Bank of America (BofA) obviously looking to capitalize on the millions of credit card accounts owned by MBNA.

But now many are saying that Bank of America has adopted some of the worst behaviors that were the cause of much anguish for MBNA's credit card account holders.

One particular complaint really caught my attention. A mature lady with a very good personal credit rating decided to take advantage of a Bank of America 0% balance transfer offer. The lady described herself as person who always pays her bills on time and who never carries a revolving balance on her credit cards. This lady soon found that she was being charged some hefty over-the-limit fees on her BofA account, even though she did not have a balance on her credit card (and she was making regular and timely installment payments related to the balance transfer deal.) When she called BofA to find out why she was being charged over-the-limit fees even though she was making her payments on time, the BofA explained that:

...even though [she was making] payments during the month to keep the balance within the credit limit, there could be a day within the cycle that the card was officially “over the limit.”

To further exacerbate the situation, she was charged $451 in interest charges, even though it was supposed to be a 0% balance transfer deal. Why was she paying interest on a 0% deal? Because her interest rate had gone from 0% to 31% as a result of a violation of the BofA credit card agreement. And this is the part of this story where you really need to pay attention; here are the terms that caused the interest rate to skyrocket:

"During the introductory period, if we do not receive at least the Minimum Payment Due during any billing cycle, you exceed your Credit Limit or you close your account, any introductory rate on Purchases and Balance Transfers will terminate and will be adjusted to the Standard Rates."

Do you see what is going on here? If you don't, allow me to explain.

It is perfectly legal for BofA to charge over-the-limit fees and interest on the above-described account. You see, this is one way of playing the 0% balance transfer game that can result in huge profits for the credit card company involved. Is it wrong for credit card companies to engage in such tactics? You decide.

Allow me to present a hypothetical 0% credit card balance transfer offer from the fictitious Balance Transfer Bank of Anytown, USA. The 0% balance transfer offer is very competitive, offering an introductory interest-free period for 18 months, with a balance transfer fee equal to 3% of the transferred balance, or $75 (whichever is lower.) The terms for this credit card offer are quite ordinary, and include the following clause:

"During the introductory period, if we do not receive at least the Minimum Payment Due during any billing cycle, you exceed your Credit Limit or you close your account, any introductory rate on Purchases and Balance Transfers will terminate and will be adjusted to the Standard Rates."

OK. So you decide that it's a great deal and you are going to go for it. After all, you have some high balances on some of your other credit cards, and the interest charges are really starting to hurt! You call the toll-free number provided to apply. You tell the representative on the phone that you would like to take advantage of the 0% balance transfer facility, and that you want to transfer $5,000 from one of your other credit card accounts to your new Balance Transfer Bank credit card--assuming that you get approved for the card, of course. The representative on the phone informs you that you have been approved for the new credit card and that you've also been approved for the $5,000 balance transfer. Cool! Everything seems to be going your way. The representative doesn't tell you what the credit limit on your new card is going to be, so you decide to ask. The representative tells you that he doesn't know what your credit limit will be, but you will receive a letter in the mail with all those details within 2-3 weeks.

A week later you get a letter from The Balance Transfer Bank of Anytown, USA. The purpose of the letter is to congratulate you on your approval status, and to let you know that your credit limit is $5,000. OK, no problem. You're transferring $5,000, and your limit is $5,000. All the math works out fine!

Two months later, you get a credit card statement from The Balance Transfer Bank, and you see that you've been charged an over-the-limit fee of $29. You also notice that the interest rate on the $5,000 you transferred has gone from 0% to 29%, and you are already accruing interest charges on the balance you transferred. All this and you have never used the card to make any purchases or cash withdrawals. Why did this happen?

It happened because The Balance Transfer Bank decided to set your credit limit to exactly $5,000--which is the exact amount you transferred with the 0% balance transfer offer. And here's the best part: the $75 balance transfer fee caused your balance to jump from $5,000 to $5,075, thus giving The Balance Transfer Bank every right to charge you for being over your credit limit. More bad news: because you violated the credit card agreement by going over your credit limit, your interest rate on the $5,000 your transferred has gone from 0% to 29%.

The scenario I've just described above is happening to folks around the country every day. MBNA was doing it, and it most likely contributed to their downfall. But Bank of America? Why would they adopt such tactics? It doesn't make sense! Surely they must know that they are going to scare away customers. Sure, it makes them some great profits in the short term, but what about the long term? Doesn't it make more sense to focus on retaining their customer base for the long haul by treating their customers fairly? Hmmm...

Just last week, I signed-up for a new Citibank credit card and took advantage of an associated 0% balance transfer offer. I asked about my credit limit, and even though the Citibank representative wasn't able to tell me what my limit would be right away, he did assure me--in fact he guaranteed--that my limit would be set to a level that is higher than the balances I was transferring, so that there would be some room to accommodate any fees that might be assessed. And that's the way it should be. A Chase representative I spoke to a few months ago said basically the same thing.

I feel that it is very important for me to note here that I've had a Bank of America Gold credit card for over 2 years now and I've had no problems with it. To be perfectly honest, it's one of the best credit cards in my wallet. I took advantage of a Bank of America 0% balance transfer offer in order to obtain the card and it was a very good deal. Flawless. No problems. It's the only credit card I own that has a picture of my baby girl on it. Over the past two years the good folks @ Bank of America have not only lowered my interest rate, but they've also given me a generous credit limit increase (both actions look great on a credit report.) So I can write here with complete sincerity that I am really confused about the latest buzz about BofA credit card offers.

The Bank of America grew from a small Italian bank into the American icon that it is today by providing their customers with superior support and service. Let's hope that the acquired MBNA tactics related to their credit card offerings are just a hiccup, and that in the very near future they'll be back to providing some of the best credit card deals around.

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