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A few years back I got suckered into a timeshare (I have posted to TMF previously about that) with a 15% interest rate. I finally got wise and decided to balance transfer it to a credit card. So I applied for an American Express Blue Cash card. I was offered a 3.9% balance transfer for the life of the balance. Sounds good so far, right? Well, today, I finally got the timeshare payoff quote of $7925.01 and wrote out the balance transfer check. In the back of the checkbook, I noticed the following:

"Checks made payable to cash, yourself, for deposit only, or to a brokerage account or similar asset account, or for purposes of making mortgage or insurance payments will be treated as Cash Advances. Your applicable Cash Advance APR, Cash Advance fee, and Cash Advance limit still apply."

My Cash Advance APR is 23.24% and my Standard APR is 13.24%. The Cash Advance limit is only $4000.

Willl I be able to balance transfer the timeshare loan? Should I call American Express and ask about it? Should I just go ahead and send the check to BlueGreen and hope that American Express doesn't notice? The timeshare people consider this loan as a mortgage loan and it shows up on my credit report as a mortgage loan. Am I screwed?

I guess as a last resort, I could balance transfer to American Express at the Cash Advance rate and then balance transfer that to another credit card.

Thanks,
DIAT
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Can you write the check to a friend/relative, and have them give you the money back? Then put the cash in your checking account and pay off the timeshare.

Or is tht too close to money-laundering?
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Give AE a call. You don't want to be dealing with refused check fees. I read the terms that you can make regular mortgage payments, but it doesn't say that you can't transfer the balance of the mortgage.

Debra
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I called American Express and asked if I could use the checks to pay off a timeshare balance. The CSR said, "Yes."

DIAT
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Checks made payable to cash, yourself, for deposit only, or to a brokerage account or similar asset account, or for purposes of making mortgage or insurance payments will be treated as Cash Advances.

It seems like the list of what is NOT considered a Cash Advance would be shorter....
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BlueGreen considers your loan a mortgage? Interesting, because I sat through a BlueGreen sales pitch last year during a stay with some friends and I'm pretty sure they said their financing was NOT a mortgage. I assume you're totally clear on the what/how of your financing, but if there's any chance that your loan really *isn't* a mortgage, you've got a loophole. I mean, BlueGreen can call their financing whatever they want, but doesn't a mortgage have some specific conditions that a time share doesn't meet? Hopefully someone can shed some light on this.

Good luck!
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concordiadiscors: "Interesting, because I sat through a BlueGreen sales pitch last year during a stay with some friends and I'm pretty sure they said their financing was NOT a mortgage. I assume you're totally clear on the what/how of your financing, but if there's any chance that your loan really *isn't* a mortgage, you've got a loophole. I mean, BlueGreen can call their financing whatever they want, but doesn't a mortgage have some specific conditions that a time share doesn't meet?"

Like what?

Curiously, JAFO
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Could you write the check to another credit card, and when they send you a check for the credit balance, you could use that check to pay off your timeshare? It would definitely be a check to another credit card then, and it would take a little longer, but still be do-able.


--Booa
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I called American Express and asked if I could use the checks to pay off a timeshare balance. The CSR said, "Yes."

DIAT


Whether or not you can use them is not the question. The question is, what interest rate will be charged on the balance? Did the CSR say, "The rate on this check will be 3.99%"?


--Booa
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Can you write the check to a friend/relative, and have them give you the money back? Then put the cash in your checking account and pay off the timeshare.

Or is tht too close to money-laundering?


I don't think that's money laundering as there is no illegal activity involved.

You may get tax laws involved, with the $7K using some of your annual gift giving exemption, but unless you plan on giving them an addtional 4.5K, it's not a problem.

WRJ
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One thing to consider here is since it is listed as a mortgage you can write off the interest. If you are saving only 1.76% (15% - 13.24%) you might consider just trying to pay it off ASAP and writing off the interest in the short term.
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Is it enough for Blue Green (the timeshare company, I assume) to *say* it's a mortgage? Did they provide you with a truth-in-lending statement, all the regular mortgage stuff? Have you been deducting the interest you pay on the loan?

So, anyone? What makes a loan a mortgage? Here's the legal definition of mortgage:

mortgage
n. a document in which the owner pledges his/her/its title to real property to a lender as security for a loan described in a promissory note. Mortgage is an old English term derived from two French words "mort" and "gage" meaning "dead pledge." To be enforceable the mortgage must be signed by the owner (borrower), acknowledged before a notary public, and recorded with the County Recorder or Recorder of Deeds.

Kat
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I can deduct the interest that I pay. Whenever the AMEX statement comes out later this month, I'll let everyone know how they interpreted the timeshare. if I get the high rate, I will try to fight it (arguing that a timeshare is not a true mortgage), and if that does not work, then I will balance transfer it to another card. I do not regret balance tranferring the timeshare loan, though, because it was at a whopping 15% anyway through the timeshare company.

Diat
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I am quite pleased to post that AMEX did give me the 3.9% for life balance transfer!!!!!

DIAT
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