Need Advice - To transfer or not to transfer

[danaf]

I have 4 credit cards with BAC.

One has a 15kish balance on it. Interest rate is 19.99. I have called them numerous times to ask them to lower the interest rate and they never would.

The other 3 cards (also with BAC) I haven't used. My checking & savings is also with them.

In total I have around 50k credit limit w/ just BAC.

They are offering to put 15 k into my bank account from one of the cards I haven't used to pay off the one card with the 15k balance on it at a 5.99% rate until May of 08. So in essence, a balance transfer to a lower interest rate.

This could help me to try to pay down. But on the other hand, if I decide to file in the future (4 months or so) would this balance transfer hurt me? It's all with BAC so they can't use the typical arguments. I've also had this balance w/ them for a few years, so they couldn't call it fraud either.

[tradewiz50]

I have 4 credit cards with BAC.

One has a 15kish balance on it. Interest rate is 19.99. I have called them numerous times to ask them to lower the interest rate and they never would.

The other 3 cards (also with BAC) I haven't used. My checking & savings is also with them.

In total I have around 50k credit limit w/ just BAC.

They are offering to put 15 k into my bank account from one of the cards I haven't used to pay off the one card with the 15k balance on it at a 5.99% rate until May of 08. So in essence, a balance transfer to a lower interest rate.

This could help me to try to pay down. But on the other hand, if I decide to file in the future (4 months or so) would this balance transfer hurt me? It's all with BAC so they can't use the typical arguments. I've also had this balance w/ them for a few years, so they couldn't call it fraud either.

Close out your BAC checking and savings account. Open it at another bank. When you start to default that bank can and will take everything out of your accounts.

[wrinkleigh]

Yes -- it will most likely hurt you, because it is considered a cash advance.

If you are 4 mos or so away from filing, can you really turn it around that quickly??????

My advice is dont do it.

[danaf]

tradewiz, thanks for the advice. Changing banks was already on my list of things to do.

I was hesitant about this but thought perhaps since it was with the same co. that the outcome might be different.

[danaf]

My lawyer returned my call from a few days ago.

I mentioned to him about the consolidation and asked why he didn't mention that this might raise a red flag. His response was, that by the time we got all the paperwork together and the waiting time for the 341, he doesn't worry about stuff like that. He was very nonchalant....a little too nonchalant.



Then I told him about this BAC stuff and he said 90 days is the presumption mark for consolidations and transfers. I told him I'm hearing more like 6 mos and I'd rather err on the side of caution.

I left it at I'd like to try to deal with this on my own (ie. not file), which is true. I don't know if I can turn this around. Hopefully yes. I just don't want to screw myself in the meantime by trying to do the right thing.

I'll think on it a bit more but I'm probably going to do the BAC thing at a lower interest rate.

[CATCHMEIFYOUCAN]

I did all that, consolidation loans, transfers, pay off this - to pay off that. Eventually borrowing from Peter to pay off Mary and Joseph I still wound up in BK. Basically I was just adding more debt to the debt I had and in the long run it just got bigger! When I consolidated my credit cards with an unsecured loan, I never shut down my credit cards - BIG MISTAKE, being a gambler that I am. I too had checking and savings account and loans and credit cards with the same bank (not yours but a different one). Had I not gone attempted a debt mgmt program I would have never known about the sneaky "cross collateral," card the credit union could use on me. The bank wouldn't allow me to completely shut down my accounts so I kept the minimum $5 balance. After I filed Bk the creditor automatically took $5 (because at the time I actually had only left $10 by accident) to pay towards one of my credit card balances, and left me with $5. If you think your going to be filing, I would stop paying them altogether and use the money that your making the minimums on towards a good lawyer and get out of the hole your digging yourself !

Best of Luck, Catchmeifyoucan

As my lawyer put it:

You Can’t Borrow Your Way Out of Debt

When you stop and think about it, it’s obvious that you cannot borrow your way out of debt. But there are so many loan offers, people think there must be a good reason for them--often there’s not.

Bill Consolidation Loans--Do They Ever Make Sense?

How much money you owe determines your debt situation. What interest rate you have to pay is also important. How many companies you owe money to really doesn’t matter, except when it comes to saving $0.39 stamps, so people who advertise consolidate your debts into one payment are just trying to mislead you. Companies offer to “consolidate” your debts by rolling them all into one high interest loan and charge you fees and insurance so you end up further in debt than you were.

There’s no advantage to you in that.

Transferring Credit Card Balances

If your credit is still good enough that you are getting pre-approved credit card offers, you may be tempted by those 3.9% introductory rate offers.

Those are great offers if they make it possible for you to get out of debt. But too many people find that they can make the payments until the interest rate goes back to 18.9%. Then they can't.

Then there's a problem. Doing a balance transfer if you cannot afford the regular interest rate--after the 3.9% is expired--is considered credit card fraud. (Or at least the credit card companies say it is.)

If you are thinking about doing a balance transfer, do a budget. See if you'll be able to make the payments at the introductory rate--and see if you will be able to make them when the regular payment kicks in. If you can't afford to pay the money back, don't borrow it.

[JRScott]

danaf I'm no whiz, me I took the approach not worry about it for a couple years and it led to a lot of problems, mental and physical health suffered, all because I wouldn't accept I needed to file for bankruptcy. I'm not saying its for you but you need to think hard and pray about it.

I would as trade says move your bank accounts to another bank. After all if you do have to default as he says they'll seize whatever assets you have with them.

Next can you reasonably pay off the debt during the introductory low interest period ? How much of the debt could you have paid off in that time. With whatever remains could you still afford to make the necessary payments to pay off the rest of the debt when the introductory low interest rate expires and the regular rate is applied? That's stuff you really need to think about. Because if you try this and in a year are in worse shape, you'd probably be better off just considering bankruptcy sooner rather than later.

[danaf]

I probably won't be able to pay off the debt.

But I also need to put as much time between Feb/March & filing date due to consolidating other cc's into a citicard.

I wish I could get a more definitive answer as to whether I should wait 6 mos or 90 days after the consolidation. If it's 6 mos, then doing the BAC thing wouldn't hurt me much. The lawyer said it's 90 days.

[SinkingFast]

Most attnys will tell you the law. Wait 90 days. But they don't have to deal with the consequences of the fall-out if the Creditor Objects. Or worse, files an Adversarial. Attnys handle the legal aspect, but they don't pay themselves or the Creditor.

The key to a successful BK is patience. Wait. Wait. Wait. As long as you can to file. The more time between your last charges and filing the better.