Best Credit Card Offer Ever*
Posted by Cap in Credit Related |Could this be the best credit card offer ever?
Look at the face on the envelope. It’s saying: “This deal is too good to be true.”
Opening up the envelope reveals even more exciting action.*
Never raised your fist in joy due to a credit card offer?
You haven’t been receiving the right one then!
Three words. High-freakin’-tech*.
Wow. Value of $850**!!
So, transfer $5,000 and maintain a balance of $3,500 for only a year and a half?*** That’s not so bad, right? Wait, what happens if I don’t have enough to transfer?
I can request a cash advance? Sweet!
______________________
* Not.
** Actual value of an Inspiron B120/B130? ~$560
*** Balance falls below $3,500 within 18 months? $600 fee.
$3,500 at 9.99% over 18 months ~ $563 in interest.
Break even? Yeah right. Initial balance must be $5,000. Balance transfer & cash advances do not have grace period; so, interest starts accumulating right away. You must maintain $3,5000 balance, which means if you pay off $1,500 right away to save on interest, you better charge just the right amount to counter balance future minimum payments.
Although purchase APR being variable is pretty standard, for this offer, your balance transfer APR is variable, unlike many other fixed offers. As of today, the rate is prime (8%) + 2.24%. According to the terms, after December 2006, it’s prime + 3.74%. So APR WILL increase.
Prime rate getting too high and you want out? Don’t forget the $600 fee.
Silliest credit card offer ever.
14 Comments to “Best Credit Card Offer Ever*”
Leave a Comment
Worse Installment Credit Ever »
« Stop Buying Crap #9 – Mobile Phones
May 24th, 2006 at 3:39 pm
Hmm, where can I sign up? It sounds like a great deal.
But the sad thing is I wonder how many people got that card and paid through the nose for that “free” laptop.
Dave
May 24th, 2006 at 4:19 pm
What is the BT/cash advance fee for this? Most cards have 3% BT fee so 5k * .03 = $150 right off the bat.
They can ofcourse “reevaluate” your credit standing at any time and jack up the rate to whatever they want before that 18 month period is up.
Lemme guess, they also give you a refurbished laptop with half of the keys broken and you have no rights since this is a “reward”. Great!
May 24th, 2006 at 5:29 pm
What is sad is that a lot of unfortunate people will look at this as a great way to get a new computer.
May 24th, 2006 at 6:56 pm
*IF* you expect to carry a balance of at least $3500 for the next 18 months, this might not be a bad deal. Sure it’s not good to carry that balance, but if you’re already in that situation, it might be worth it to surf the balance over there instead. IF you close the old account to not be tempted to spend more. I agree, going in to debt just to get this ‘free’ laptop is dumb, but if you’re already there, and hopefully working out of debt, this might be a small extra nicety to save you from going *further* in to debt by going to bestbuy or someplace else and buying a new laptop.
May 24th, 2006 at 10:59 pm
for this particular offer, the initial account opening transfers have no fee.. but if you transfer a balance afterwards, it’s the standard 3% but with a surprisingly low maximum of $50.
the offer says new laptops, so hopefully they keep their words and don’t send refurbish junk. and yeah the terms made very clear that the rates can change at anytime.
how many will take the bait? according to the offer site, over 70,000 people. (wow)
I didn’t mention it in the post, but like many others I have 0% BT offers going, so I definitely have the balance amount they’re looking for, and my credit score is currently craptacular, hence receiving the funky offer. It’s pretty interesting to see the varying amounts of offers you get as you score go up and down from 750+ to 600s.
Michael has a point though, if you’re carrying a balance already and it’s at some insane rate already, you might as well transfer & get a “free” laptop out of the deal.
Still, I would never suggest anyone to do this, even if they don’t expect to be able to pay off $3,500 in 18 months. Giving yourself a penalty (or incentive) to not pay off a credit card debt early is just asking for continue debt problems.
May 25th, 2006 at 5:33 am
You forgot to offset the fees with interest made on $3,500 in let’s say average 18 month CD at 5%, that would make $252.50 interest.
I didn’t recalculate your figures, but if you’re right that you’d basically pay ~$563 then subtract the ~$263 you’d make on interest, and you’re looking at $300 laptop (although still crappy laptop if you ask me).
May 25th, 2006 at 5:48 am
They know, with the spending habits of most Americans, that they will come out ahead in the end. That is why they tempt you with offers like the 0% Balance Transfers, or gifts.
I don’t know how many times I have heard people (including myself) say “I just want this credit card for emergencies”. But before you know it your balance is up to $2500.00 and you have 2 month left on your 0% balance offer!
I’ve paid off almost $2000.00 in credit card debt in the past 18 months by switching my balances to 0% cards. Then paying them off before the cut-off date expires on the offers. Let them keep their cheesy “gifts”! Give YOURSELF a gift and get DEBT FREE!
May 26th, 2006 at 7:58 am
I got that same dang thing. My 70-year-old mother, who has paid cash for everything, including her home (!), and has no credit cards, laughed at it on sight. Never having seen a credit card offer, she said, “I bet you end up having to pay big interest or some kind of penalty to get that.” Grandma knows best.
May 26th, 2006 at 10:48 am
I think I have figured out the nefarious conspiracy of this credit card company’s evil plot! They want to give you the laptop, then you will order stuff you don’t need online using your shiny new laptop and then pay for it with your shiny new credit card!
January 18th, 2007 at 2:30 pm
Besides all that, it’s a DELL. :-(