Personal Finance

MBNA 0% For 15 Months

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  • Jun 15th, 2011 3:50 pm
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Newbie
Feb 23, 2007
2 posts

MBNA 0% For 15 Months

Just got an offer in the mail for a platinum MBNA Mastercard with a 15 month 0% interest rate on balance transfers and cash advances. The credit limit on this card can go as high as $100,000.

So I started thinking, I do need to buy a car so why not apply and get a 0% rate for 15 months on the car? Then I started to think, hey why not borrow to the max on the card take the cash and invest in an ING Savings account at 3.5% or even a 1 year GIC at 4%? I'm pretty sure I can qualify for over $25,000. The math says I can pick up a grand on this exercise.

Seems too simple. Am I missing something? (yes I know I'd have to pay tax on the income).
1824 replies
Deal Addict
Mar 6, 2005
4797 posts
414 upvotes
Keep in mind with MBNA, there is a 1% Transfer fee involved.

So if you transfer $5000, you will be charged $50 for the BT.
Deal Addict
User avatar
Dec 27, 2006
1384 posts
114 upvotes
Toronto
tkyoshi wrote:
Feb 24th, 2007 7:38 pm
Keep in mind with MBNA, there is a 1% Transfer fee involved.

So if you transfer $5000, you will be charged $50 for the BT.
Yeah, that's one down side of MBNA BT.

But having the money earning 4% for 15 month is pretty good.
Jr. Member
Dec 22, 2005
163 posts
7 upvotes
and your minimum payment is going to 3% of the balance.
Deal Addict
User avatar
Dec 27, 2006
1384 posts
114 upvotes
Toronto
It depends... sometimes MBNA offers "reduced" payment amount @ $10.
Deal Addict
Dec 9, 2006
1221 posts
81 upvotes
I got this too and was wondering how they charge the 1%. Do they add it to the account and you have 15 months at 0% to pay it off too? Or do they add it and charge 19% and when you pay your bill the payment goes towards the BT not the fee at 19% effectively forcing you to pay off the BT before paying off the fee.

That's really the only thing holding me back on this offer.
Deal Addict
User avatar
Dec 27, 2006
1384 posts
114 upvotes
Toronto
Each offer is different so you should call MBNA and ask.
Deal Addict
Aug 28, 2002
1680 posts
okay well if they accrue at 19% then the offer jumps to 1.19% of balance not a big deal

The bigger deal is there not going to give you anywhere near a $100,000 - afaik - so buying a entire car with it is going to be difficult. I'd think realistically you'd get $25000
Deal Addict
User avatar
Apr 4, 2005
2661 posts
121 upvotes
Toronto
i apply once they gave me 9000 when i complain they give me 12500. nothing like free money to play with for a year. bought canadian equity stock since each year it return about 15% so basically earning 14% free money!
[QUOTE]there's no such thing as a stupid question unless it's a really stupid question - me[/QUOTE]
Deal Fanatic
User avatar
Nov 19, 2004
6400 posts
561 upvotes
Cambridge, ON
I am already doing this with the MBNA card. Things to consider:

1. Your credit rating takes a hit while you have this but will recover once paid off. The signifigance of the hit depends on how much other credit you have your debt utilization ratio, etc. It may not matter if you aren't lloking to take out a loan in the next 15 months.

2. There probably is a 1% fee. But you are still making at least 3% by investing the money in something safe like a GIC so you are getting free money. Of course you get taxed on the interest from a GIC at your tax rate. This 1% fee is tax deductible since it is a charge icurred to borrow money for investing. However, the money must be invested so if you are going to use it for a car, the 1% is no longer tax deductible.

3. The minimum paymnet for mine was $10 a month for the duration of the offer (not a 2-3% minimum). But this may be different for your offer.

4. Under no circumstances do you use the MBNA card for anything else until the promtion is over (and you have hopefully paid the money back). If you use the card even for one purchase, any payment you make to cover that purchase gets put on the lowest interest portion first (which is your 0%) so you would be paying the full 19% on that purchase until the 0% amount was paid off. If you take the offer, cut up the card.
Deal Addict
User avatar
Jun 18, 2004
3070 posts
46 upvotes
Mo'fuggas! I just did thius but MBNA charges me 1.99%! On top of the 1% service fee! How come I never get the cool 0% deals? > :(
Deal Addict
Dec 9, 2006
1221 posts
81 upvotes
don242 wrote:
Feb 25th, 2007 3:07 pm
4. Under no circumstances do you use the MBNA card for anything else until the promtion is over (and you have hopefully paid the money back). If you use the card even for one purchase, any payment you make to cover that purchase gets put on the lowest interest portion first (which is your 0%) so you would be paying the full 19% on that purchase until the 0% amount was paid off. If you take the offer, cut up the card.
What about the 1% fee? Does it fall under a purchase and is charged 19% which you can't pay off until the BT s paid off? Or do they give you it at 0% for 15 months too or something else?
Deal Fanatic
User avatar
Nov 19, 2004
6400 posts
561 upvotes
Cambridge, ON
sunnyd71 wrote:
Feb 25th, 2007 4:15 pm
What about the 1% fee? Does it fall under a purchase and is charged 19% which you can't pay off until the BT s paid off? Or do they give you it at 0% for 15 months too or something else?
No the 1% fee is charged upfront. So if they give you $10000 as example, you could take out roughly $9900 and you will be charged $99 upfront. Your first bill will be $99 + $10 (minimum) for a total of $109 due the first month. Then each month after is $10 (assuming that is your deal).
Newbie
Feb 25, 2003
31 posts
Toronto
Would anyone be willing to share his/her "priority code"? I didn't get the mailing, but would like to jump on this.
Deal Addict
User avatar
Oct 23, 2006
3285 posts
506 upvotes
Winnipeg
cervinka wrote:
Feb 26th, 2007 2:50 pm
Would anyone be willing to share his/her "priority code"? I didn't get the mailing, but would like to jump on this.
2nd that, please.
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