Is it possible to beat the credit card companies at their own game? My idea was to sign up for a balance transfer credit card with a 0% APR introductory offer, then use this “interest-free loan” to pay down my credit card debt, rolling it over to another 0% APR card if I needed more time. Now I just needed that second 0% APR card [Read Part 1 here.]
Round 3: Chase Visa Slate
Although it sounds a credit card from The Flintstones, the Slate Visa from Chase is actually a well-regarded card for paying down debt. I spoke with Amanda, who told me about card features like “Finish It,” which is not a final boss mode in a videogame, but a built-in plan that helps you pay off your balance in an efficient manner.
I told Amanda that I was $10,000 in debt from trying to start a business selling carbon-fiber underwear, and wanted to pay off my balance without having to pay any interest. She said the Slate Visa would give me a 0% APR for six months, with no annual fee. There would be a balance transfer fee of 4% — less than the Discover card.
“What other fees are there?” I asked Amanda. “I don’t want any surprises. I have a weak heart.”
“Well, if your payment was late, you would be charged a late fee of either $29 or $39.”
“And would I get to keep my 0% APR?”
“Well,” she hesitated, “someone would look at the account and determine your new APR based on your payment history.” She said it like a banker would be peering over his glasses at your credit card statements.
“Surely this is automated,” I said. “You don’t have someone manually reviewing every account that’s late. It’s a computer.”
“Well, yes,” she admitted. “It’s automated.”
“So when does the computer turn off the 0% APR?”
“After thirty days,” she confessed. “If you’re thirty days behind payment.”
I told her I wanted to keep the card for six months while I paid down my debt, then transfer over to another card and close this one out. “Will you feel hurt if I do that?” I asked her.
“Well, banks don’t like to lose customers, so sure, we’d feel hurt.”
“No, I mean you personally, Amanda.”
“I guess I’d be a little sad.”
“Thanks, Amanda.” I took a deep breath to keep from choking up. “I love you, too.”
So, here it is: your plan to get rid of credit card debt, without having to pay your credit card company a nickel of interest.
1) Sign up for the Slate Visa from Chase.
2) Roll over your balance at 4%, or use the clever arbitrage method mentioned in Part 2 to “roll over” your balance for free (you’ll need a friend to help).
3) Pay off your debt for the next six months. Be sure to make all payments on time, paying off as much as you can afford.
4) If it’s not fully paid after six months, then sign up for the Discover More card.
5) Roll over your balance to the Discover card (or use the arbitrage method), then close out your Slate Visa card.
6) Continue paying off your debt for the next year.
7) Repeat steps 1-6 as necessary, until you’re debt free!
To cut down on the temptation to spend, you can also learn some self control cut up the credit cards as soon as they arrive at your door — just use them for the 0% APR offer, and ditch them when the offers expire.
And when you’ve finally conquered all your credit card debt, buy yourself a drink to celebrate. Just remember: pay off your credit card balances in full each month and use cash back credit cards to make your credit card work FOR you and not against you!