Speaking of Balance Transfers, I just devised my own

[ctfudge&bankofC-ville]

This is an example of how you can shift balances around IF You are able to make large scheduled payments by credit card.

I just got a $3000-limit Hooters card. The rate is 19.5% (I know, not great, but better than the OTHER Merrick card I have.) They do not offer balance transfers, or at least won't offer one to me, but the rep suggested, when I asked, that I take out a cash advance if I want to pay off something else. No thanks - that rate is sure to be super-high.

I have a regular Merrick card with... well, to be honest, I owe $2,022.00 on it and the rate is 33%.

I have to pay rent each month to the tune of $1179.00. Payment by credit card is allowed, but the "fee" collected by the rent-payment company for paying in this manner is a percent, I guess - it works out to about $30 for me.

I just paid rent with the Hooters card, ate the $30 (I'd be charged this much anyway, were I doing a balance transfer) and took the $1179 we had set aside to pay rent, and paid down my regular Merrick card.

I know this isn't the most striking example, but in past months, I've done the same thing, paying OFF a terrible-rate card by putting the rent money on an 8.9% card. Just a trick I thought I'd share with you guys!

[brokeinok]

Wow! $1179 for rent? WOW!!! For that much here, you could purchase a 4bed, $350K home in one of the REALLY nice neighborhoods!

[Magdalen77]

Wow! $1179 for rent? WOW!!! For that much here, you could purchase a 4bed, $350K home in one of the REALLY nice neighborhoods!

Sounds reasonable for an apartment in Philly.

[VeVe]

Sounds reasonable for an apartment in Philly.

Sad but true.

[virginiabound]

$1179 around where I live isn't that bad. Lemme guess, the OP lives near the VA/DC or Baltimore area?

We live near Winchester in horse country. Our rent is $750 and it's a 1bedroom bachelor apt. I Can't Wait to get out of here and into something bigger.

I'm actually glad we can't pay by credit. Too tempting to use the rent money for something we can't afford.

Another 'good' thing about our rent. Hubby wasn't very good with money management. He would give checks (really unbenkownst to him) that would NSF. Landlords will only take money orders now. I actually like this idea, because they take FOREVER to cash checks. Now, there is no chance of having NSF and I know exactly how much money is left.

[daveyzzz]

We're just north of Baltimore in a nice part of the county. Around here $1179 is just slightly above average. In fact - our apartment complex recently changed ownership and they bumped up the rent for new tenants by over $100 a month.

For contrast I used to pay about half that much to rent a whole townhouse in the city. The catch was you had to wear a flak jacket and dodge bullets when walking to your car. (No lie - they pulled 14 bullets from the roof the month after I moved out).

[ctfudge&bankofC-ville]

Yes, north of Baltimore. It's just an apartment, too! A really nice one in a really nice, country-ish area.

Had we gotten a mortgage years ago, we could be paying the same for a nice, big house. Not now, though - not around here. Houses in the neighborhood are about 400K to start, and I've priced condos the same size as our apt. at about $300K, so we're getting a better deal with rent than we would paying a mortgage, in this market. Even with prices falling.

*oops, didn't know the hub was posting a few feet away from me, at the same time.

[Magdalen77]

$1179 around where I live isn't that bad. Lemme guess, the OP lives near the VA/DC or Baltimore area?

We live near Winchester in horse country. Our rent is $750 and it's a 1bedroom bachelor apt. I Can't Wait to get out of here and into something bigger.

I actually pay only $650, but I lucked out. I was desperate when I was looking and I must have looked pathetic. The landlord let me move into his "senior citizen's building". He doesn't charge as much for these apartments. (I know a compassionate landlord, what are the odds?) It's an old building in an older, inner suburb of Philly. But, $1179 would be right there for a new building in a merely alright suburb. A nice apartment in one of the new complexes could easily cost $1400.

[brokeinok]

Wow again.... here that much rent would get you one of the new high rise apartments in the renovated areas of downtown, doorman, underground parking, bellmen and the works.

My mortgage payment plus one car payment isn't that much..... WOW again...

[ctfudge&bankofC-ville]

doorman, underground parking, bellmen and the works.

Parking right outside my door, washer/dryer in my large kitchen, and maintenance men who pick up our trash for us right outside the other door 3x per week... is that close enough to doorman?

Seriously, it's only $100 or so higher than living in a much-worse area a short drive away, a little of it is the area (pastoral and near watershed land), and most of it is just the Eastern-Coastal-Major-Metropolitan-Area price basis.

[virginiabound]

Yes, north of Baltimore. It's just an apartment, too! A really nice one in a really nice, country-ish area.

Had we gotten a mortgage years ago, we could be paying the same for a nice, big house. Not now, though - not around here. Houses in the neighborhood are about 400K to start, and I've priced condos the same size as our apt. at about $300K, so we're getting a better deal with rent than we would paying a mortgage, in this market. Even with prices falling.

*oops, didn't know the hub was posting a few feet away from me, at the same time.

Same thing here. Houses where we live (really nice ones with a nice big yard) start at $400000-500000. We can't even get a mortgage yet, so we don't even have to worry about that yet!

When we leave here we'll be looking at $800-$1200 for rent. That'll get us the size and space we need and a Washer/Dryer. I am DYING for one!

We also don't have a lease currently, so we can leave at any time, just need 30 days notice. And although we complain about the landlords, they're really not that bad. They're letting me update the bathroom (I do the labor and they pay for all supplies). Win-Win. I'm happier, and they'll have an easier time renting this small place. I'm trying to get them to let me do the kitchen too! And they are also paying for the paint. I asked if I could paint...I picked the colors and she said to give her the receipts. So, no, I guess we shouldn't complain.

Wow...sorry to get so off topic there!

But, you're kind of a neighbor

[ctfudge&bankofC-ville]

Yes - howdy neighbor!

I cannot complain about the management here. We call about anything and they are here before we hang up the phone. W/D breaks or has any problem - they replace it. Dishwasher getting shabby and has problems, too - new dishwasher. Vents and ducts need cleaning - all of this done without a penny charged to us. Water damage - they pay for the days' worth of labor required to fix everything - new floors, etc., and when I piped up to complain that the cabinetry was old - "cabinet installers will be there on Wednesday."

I make it sound like there have been lots of problems but we've been here 5 yrs. Would like to buy a house and will at some point, but unfortunately, we were going bankrupt while the prices around us pretty much doubled in these few (seemingly short) years.

[jq26]

Wow! $1179 for rent? WOW!!! For that much here, you could purchase a 4bed, $350K home in one of the REALLY nice neighborhoods!

Really? Assuming a decent down payment of 10% + closing costs (roughly $45k coming to the table), I figure you'd have a payment of roughly $2350. $1900 (principal + interest) + $300 (taxes) + $150 (insurance). That is almost double per month to own the house even without any other monthly bills covered by rent and inevitable cap ex spending.

As far as the OP's "balance transfer", good thinking!

[Magdalen77]

Really? Assuming a decent down payment of 10% + closing costs (roughly $45k coming to the table), I figure you'd have a payment of roughly $2350. $1900 (principal + interest) + $300 (taxes) + $150 (insurance). That is almost double per month to own the house even without any other monthly bills covered by rent and inevitable cap ex spend

I was wondering about that too. $1179 seemed awfully low when I'm looking at a $800 or $900 mortgage for a $150-200K house here in (not such a nice suburb of) Philly. That's with the minimum downpayment for FHA of 3% and somewhat crappy credit (low to mid 600s)

[stefdr]

Wow, some insane prices. I rent a 3 BR 2 Bath house for $595/month. Average for where I live.

[Freak]

IMO its all relative to the cost of living. In these places that have high housing prices (and everything else), people will generally make more money, and vise-versa. all things considered, someone making 120k in the Northeast, may have the same percentage of expenses as someone making 50k in another part of the country. Not apples-to-apples for sure, but I still think it is all relative. A lot of it also has to do with lifestyle too.

[Krash]

I would like to know, do you really benefit from the "robbing peter to pay paul"? I have a student loan which shows installment, it isn't a school loan just a driving school loan with wells fargo, well I have had it and not made extra payments on it for 6.5 years and I still owe 33 hundred bucks. I know the interest is compounded daily and it sucks, some months I don't even have any principal out of my 115.82 a month, my question is this, if I put it on a credit card of mine that has 15.49apr would I actually be able to pay this down better and quicker or would I be wasting my time and racking up a new bill?

[ctfudge&bankofC-ville]

Well, before someone else does the math, I can think of one difference right away in your situation vs. my situation. Your loan is closed-ended, meaning there's no line of credit available. Meaning once you pay that student loan down (or off) it's done and there's no money you can access if you have to, through that loan, again. With a credit card, at least paying a balance down or off raises the available credit. Just one difference I thought of.

So, if you somehow moved the amount owed on the student loan to a credit card, you'd chew up a bunch of available credit on the card, and have no available credit via the student loan (but it would be paid.) I've got a sinus headache so I'm not up for the math right now, but I'm sure someone else will do it re: installment loan interest vs. revolving credit interest.

[Krash]

yeah, i would like to get rid of them and it would take up over 50 percent util and i don't know really! I know if i did it with a interest calculator it says pay 144 a month for a year and it will be almost paid for, or something like that... I wished someone else could chime in, I really want to know how to do that interest!

[jq26]

I would like to know, do you really benefit from the "robbing peter to pay paul"? I have a student loan which shows installment, it isn't a school loan just a driving school loan with wells fargo, well I have had it and not made extra payments on it for 6.5 years and I still owe 33 hundred bucks. I know the interest is compounded daily and it sucks, some months I don't even have any principal out of my 115.82 a month, my question is this, if I put it on a credit card of mine that has 15.49apr would I actually be able to pay this down better and quicker or would I be wasting my time and racking up a new bill?

1) Is the driving school interest tax deductible? What is the rate? Generally, robbing Peter to pay Paul doesn't make your debt go away, but it lessens the monthly burden if you are moving it from high cost money to low cost money. So if the NEW loan taken out to refi the old one is significantly lower interest rate, then if you make the same monthly payment, you'll pay more to principal and pay it much faster. Or in the alternative, IF WE ARE NOT TALKING ABOUT CREDIT CARD DEBT but deductible low cost school loan debt, reduce your new lower payment to the new minumum, and fund your 401k or Roth IRA.

[Krash]

yeah, it was a very high interest deal with wells fargo well they ended up with it, lol!! So i dont' know.. I guess i may just pay half down, and then put the rest on the card, lol.. Thanks i just kinda figured i would have less interest so i could make my 115.82 a month without having to double payments for 2 years to pay it down lol.. Thanks

[brokeinok]

Krash...

Try this website

http://www.timevalue.com/Tools.aspx

They have free online calculators.

[Krash]

thanks, i sure will!!! I appreciate it, I am sorry for jacking the tread OP, well if I did it right, i put in 28 percent on the student loan and at my rate it will take 49 payments, and if i put it on the cc at 15.8 it will cut off 1 whole year of payments at no more than 115 a month, wow!! I hope it did it right, i may go ahead and do it, i hate paying them lol

[jq26]

thanks, i sure will!!! I appreciate it, I am sorry for jacking the tread OP, well if I did it right, i put in 28 percent on the student loan and at my rate it will take 49 payments, and if i put it on the cc at 15.8 it will cut off 1 whole year of payments at no more than 115 a month, wow!! I hope it did it right, i may go ahead and do it, i hate paying them lol

Your student loan rate was 28%? Usually they are at 5-6%. Pay that debt down (now credit card debt) as soon as possible.

[ctfudge&bankofC-ville]

jq, you're thinking of college loans, and maybe just old-school college loans at that. (I don't know what the rates are like now and don't really want to know.) I've heard that trade-school loans can be real rip-offs. They take advantage of people wanting to get some training and start a career.

Don't worry about threadjacking - it does not bother me. Interesting discussion anyway, and right on topic. This is all good stuff, because it gives other people (including me) ideas on how to shift things around to our advantage. I constantly strive to do that.