Hey, Mister, Can You Spare A Dime?

It seems like I’m having some luck with Chase. Recently, Chase increased my credit limit by $1,000 to $5,500. (BTW - my Chase card has the smallest credit limit).

I just got a mail the other day with the headline : Write the check now. Pay it off later!. Isn’t this is what got us all into trouble in the first place. Well, it turns out that it is a letter offering me to do a balance transfer deal. Here was what the letter said :

Dear Mr Credit Card

Wouldn’t it be nice if you could write a check now and pay it off later - just like a credit card? Because of the good credit on your Chase Visa&#174 account ending ####, now you can. We’ve attached checks you can write for any amount up to the used portion of your available credit.

Use the checks to get a low promotional 0% fixed APR until your 02/2010 statement opening date.

You can use the checks to transfer balances from other high interest rate cards. Or write a check to yourself and deposit it into your checking account. Just make sure you have enough available credit for the transaction(s), interest and any related fees.

Now, whatever great opportunities come your way, you’ll have the funds to take advantage.

Sincerely

Deb Wadden
Executive Vice-President, Customer Experience.

P.S. - Hurry, your checks must post to your account by 3/31/2009 to get this low promotional rate. For your convenience you can take advantage of this offer by using the enclosed checks, visiting www.chase.com/balancetransfer, or calling 1-800-945-2014.

I have a friend who works in the Chase credit card department (he is my inside source). He has told me that Chase has essentially stopped offering and marketing new cards, drastically reduced their direct mail campaigns. All they are doing now is just managing credit risk!

So I was pretty surprised to find this offer - which is essentially a balance transfer or 0% APR offer on purchases. I guess they would rather extend to existing customers than get new “riskier” customers?

But given that most banks now have removed the caps on balance transfer fees, I decided to look for the fine print. It was 3% of balance transfer, with a $5 minimum and a cap at $199. This cap of $199 is kind of meaningless because even if I transferred my entire line of $5,500, 3% only works out to $165! (note - if you apply for Chase cards from their site, they have no caps on their balance transfer fees!)

But those of you regular readers know I pay my bills fully every month. So this offer is essentially useless.

Oh - before I forget - right at the bottom of the letter it says :Use these checks to

Take a tropical vacation
Get a new computer
Spruce up the kitchen
Make a down payment on the car
Buy a new couch
Do whatever you choose

I always thought a down payment was not meant to be borrowed. And to think of how we all got into this mess, and how they screw customers who pay late etc, that they would still encourage us to use credit for these purposes simply bewilders me!