Credit card balance transfers can be a good thing when done carefully and wisely. Even though you may have read all of the fine print and have covered all your bases, occasionally a company will blatantly try to scam you by failing to disclose a fee.
This happened to me recently when I decided to do a balance transfer through Bank of America. I did my due diligence and learned about all the fees and they were this:
1. A 0% APR on balances transferred for 6 months- ok, that’s fine.
2. Balance transfer fee of 3% of the balance transferred up to a maximum of $99.00. – This is fine too- I am willing to pay someone $99 to borrow a chunk of cash for 6 months- not bad.
I asked the Bank of America representative if there were any more fees besides this. She said no. I wanted to make sure, so I asked her again, ‘So, you mean, as long as I pay my monthly bill on-time, there are no other fees, finance fees, or any potential costs of any kind?’ ‘That is correct,’ she said, ‘there are no other fees aside from the $99.00 fee.’
She did recommend to me, however, to be sure and pay the $99.00 fee along with my first month’s payment to avoid a finance charge. She said the statement won’t tell me to do that. I then clarified and asked if there would be any finance fees occurred prior to my first month’s billing statement. She said no.
I transferred my balance.
The first month bill came and it had a finance charge. This was despite my thoroughness in interviewing the Bank of America representative about any and all of their fees. There was a flat out discrepancy between what she said and what I was billed.
I called back and was insistent that a finance charge was not communicated to me and that I demand a credit. They credited it. But, if I had not taken time to call in and plead my case, the finance fee would have triggered more fees. Fees upon finance fees. Then it may have resulted to me losing the 0% apr for 6 months. The interest rate may have shot up to 18% or more.
Bank of America tried to pull a fast one on me. The way they billed those finance fees before you even have a chance to pay them is ridiculous- they were incurred before the first month bill was sent. And their phone representatives failed to disclose this.
From day one, they will start their process of trying to scam you with their fees. It takes a lot of thought, energy, and prudence by the customer to see though their financial traps. It’s a game. They offer an attractive service (0% for 6 months), betting that you will fall into their traps and pay them lots of interest and fees.
They usually win.
