Wednesday, September 29, 2010

Read between the LINES!! (balance transfer)

Bank are such a money sucker!!

Okay, HSBC called me this afternoon to offer a 12 months 0% interest fee balance transfer! No processing fee, no early settlement fee, no fee involve!! Sounded too good to be true ya!!! Wait....

Let me give u a scenario to help u see the picture clearer.

Balance transfer amount from Bank A - RM6k (0% interest for 12 months, pay as u wish)
Current month retail transaction - RM8k

When the statement comes, my outstanding should be 14k rite? Okay, I am a bit tight, so i issue a check to HSBC CREDIT CARD FOR XXX XXX XXX amounting RM10

So, is the bank smart enuff to decide for u to pay 8k for the retail transaction & 2k for the balance transfer amount???? Dun be so naive!! read further!

When HSBC got the payment, this is the DEFAULT formula they will use to offset the payment is

1st - To pay off all fees n charges (like annual fee, late payment fee, interest, etc etc)
2nd - To pay off the balance transfer amount
Lastly if there's still $$ left then only it will be used to offset your retail transaction!!

So based on my earlier example when I pay RM10k, the bank by DEFAULT will pay the 6k balance transfer amount and the remaining 4k to offset the retail transaction.

Got it???

In case u still don't get it, you will still have an outstanding balance of 4k from your retail transaction which will attract the normal interest rate of 18% per anum!!! So at the end of the day... you are still paying the interest! The point is to WHOM you are paying! So y bother do the transfer in the first place????

ARRGHHHHHHH Bank are such a money sucker!!!!!! They almost got me manipulated!!!!

Think TWICE or THRISE when you want to do balance transfer!

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