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Author: joelcorley Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 310999  
Subject: Re: Nov 06 Update & Advice Needed Date: 11/7/2006 3:22 PM
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You wrote, This is what I currently have left:

Bank of America
APR 7.90%
Debt $11,529.62
Credit Limit $19,200.00

APR 2.99% BT for life of the loan
Debt $2,288.75
Credit Limit $6,200.00

This hobbit is torn. The emotional mind wants to pay off Citi first, because then I'll only have one card with a balance. But the rational mind observes that I'll be paying more interest over the long run if I do this.

To add to the turmoil I got a 0% BT offer (for 12 months) from HSBC Bank Nevada (anyone heard of them?) in the mail today. The letter says balance transfer fees will be waived at the time of application. Yes, I do understand that it may mean that I'm approved to receive the offer in the mail, but it doesn't mean that I qualify for the BT offered in the letter. Though you have to love the way the letter starts out! "Your improved credit standing has not gone unnoticed..." *smile*
Should I not add another account? Instead should I call one of the accounts I already have and ask them if they can match this offer?

Your advice is very much welcomed!

HSBC (Hongkong and Shanghai Banking Corporation) is a huge international banking conglomerate that acquired Household Bank (and maybe a few others) in recent years in an effort to make in-roads in the U.S. banking market. Think of them as in competition with ING. [In fact, they offer a similar, highly competative online savings account product, currently paying 5.05%APY with a $1 minimum balance requirement.] Here's the Wikipedia page on HSBC: http://en.wikipedia.org/wiki/HSBC

I'd have no problem with taking HSBC's offer. In fact, I'd toss everything they'd loan you at BofA first, then Citicard if they'll give you enough. Max out at 0%BT offer if you can.

Then I'd open an HSBC savings account. Stick anything extra, plus your montly snowball into the HSBC savings account and make only the minimum payment on the HSBC credit card. In 11 months pay off the balance from what you've accumulated in the savings account.

Finally, keep throwing that snowball into savings until you have a real e-fund! If any of your credit cards offer you 0%BTs, take that money and stick it into savings until you have to repay it too. You'll be amazed at how good it feels to be earning $100/month in interest instead of paying $100's to a credit card!

Of course in the end, you need to also throw plenty of that snowball toward retirement savings and other financial goals...

- Joel
Who actually made around $160 in interest last month! :-)
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