Conference 7.286::dcu

    Every single credit card I've ever had has worked this way.  And
    I've had my share of credit cards.
    
       Gary

    
    Agree - I've had and embarassing amount of credit cards - every
    single one works this way.  Never thought about your plan, though.
    That's interesting.  
    
�                  I expressed my disapproval of the  system,.....
�
�       I  sat down  and tried to make sense of system whereby if you make
�       50 purchases (loans) in a month and pay off 49 of them, you incur
�       charges on all 50.

    Well, remeber now...  In this case it may look like you're getting
    a bum rap.  But look at the "normal" case for you - paying off the
    full amount every month.  
    
    During those times you are basically getting interest-free loans
    for 30 days.  Where else can you get that?  Not that I'm any great
    fan of banking morality..... :^)
    
SEAN/BEER=LABATTS    

       Is the interest rate higher for a cash advance than it is with
    a 'regular' charge card transaction? I believe some banks do charge
    a higher rate.
                                      Denny

    The current interest charges are the same for cash advances as for
    purchases.  BTW, most bank credit cards do not permit the use of cash
    advances to pay off purchase balances.  Anyone know the DCU rule?
    
    /Ed 

    re: .4
    
>    	    BTW, most bank credit cards do not permit the use of cash
>    advances to pay off purchase balances.  Anyone know the DCU rule?
    
    Of course, if you do it correctly, they can't say boo about it no
    matter *what* their rule is.
    
    Say you went to the bank, got the cash advance, and deposited it
    into checking.  Go back later in the day and pay off your card with
    a personal check (or, in this case, maybe you can use Easytouch
    -- I don't know).
    
    Once the money is in your possession, they'd have a very hard time
    telling you what to do with it.
    
    -- Russ

    I think that the way banks close this loophole is to insist on applying
    any payments first to outstanding interest (if any), then to cash
    advances, then to purchases.  So if your billing period ends on
    the 30th, with, say a $100 purchase balance, a $0 cash advance
    balance, and the bill due the following 30th, and you take out a
    $100 cash advance on the first, and pay the bill on the second,
    well before the due date, the bank will apply the $100 to the cash
    advance, even though it was made after the close of the billing
    cycle.  That way, you're still left with a $100 purchase balance
    that hasn't been paid off.
    
    Don't quote me on this, though, I've never done it.
    
       Gary

	I checked  into how DCU applies payments.  I looked in the Member
	Agreement that was sent with my Classic Visa in September, 1987.
	In section 3, it states clearly that payments are applied:
	
	First:  to any unpaid Finance charge
	
	Next:   to the remainder of the New Balance for the prior billing
		period
	
	Then:   to any new Cash Advance
	
	
	So i still think my idea will work, at least at DCU.  -- harrY

        If I recall the "usual procedures", a cash advance of any amount
        automatically triggers full finance charges on the average daily
        ballance for that billing period. If so, this game won't help you
        at all. 

	I don't  know  for  sure  what "usual procedures" are.  I suspect
	that if you called a hundred different banks, each would consider
	their procedures "usual" or  "standard",  yet  each  would vary a
	little from the others.  
	
	That's why i checked the  Member  Agreement.  I find no provision
	for  cash  advances automatically triggering finance  charges  on
	your average daily purchase balance at DCU.  Does anyone?
	
	By the way, it took me a  few  extra  minutes to locate my Member
	Agreement when i first went to retrieve it.   It  wasn't where it
	was supposed to be.  Fortunately,  it was in the 2nd or 3rd place
	i looked.    I strongly recommend having this agreement somewhere
	where you can  find  it  when you need it.  The first thing to do
	when you have a  question  about  your  bill  is  to  reread this
	official document.  Have it  in  your  hand if you call them.  If
	this document backs you up, you  are  in good shape.  If it backs
	them up, you can bet they will  quote from it liberally.  This is
	only fair.
	
	If you can't find your copy, by all  means  call  or  write for a
	replacement.  -- harrY

    With ANY OTHER lender you pay interest for each day on each dollar.
    DCU and other credit card companies do you a favor by deleting all
    charges if your balance begins and ends in $0.00.  Basically, if
    you show that you do not intend to borrow across a billing interval
    they give you free loans. IF you borrow anything, they charge you.
    
    I think this system is MORE than FAIR and I support it 100%.
    
    	Rick
    	Merrill
    

	I set  up  a  test  today.  For the monthly billing cycle that is
	just about to  end,  i have a balance due of approx.  $370.  I do
	not have enough money  available  to  pay off the whole thing;  i
	can pay $300.  This  is  the  type  of  situation  where  my  new
	information is helpful.
	
	If i just paid what i  could afford to pay, i would expect to see
	finance charges of about $5 based on  my  average  daily balance.
	Instead, i took a cash advance of $70  and  paid  off the balance
	due.  I expect to pay off the cash advance in a week or two, so i
	expect  total finance charges to be less than $1.   That  is,  if
	i've interpreted the rules correctly.
	
	I will let you know.  -- harrY
	

	I received the results of my test yesterday.  The results are:
	
				  BIG  SAVINGS !!
	
	I used the technique described in  the  base  note.    My finance
	charge this time,  instead  of  being five dollars or more, was a
	whopping 13 cents!   By  taking  a few extra steps, i saved about
	97% of the finance charge  i  would  otherwise  have incurred.  I
	feel it was well worth the  effort.   I just wish i knew about it
	sooner.  
	
	Now of course there  will  be some additional finance charge this
	month because my cash advance  was still outstanding on the first
	day of the new month.   However,  i have since paid it back, so i
	expect any additional finance charges to be  very small, like the
	current finance charge.  All in all, this  technique represents a
	major improvement over what i was doing before i  understood  the
	rules.  
	
	I want to repeat for emphasis that  i  still recommend, if at all
	possible, to pay off the entire balance due in full each month to
	avoid all finance charges.  However, you might run  into  a month
	like i did where it's just not possible to pay  the  whole thing.
	If  so,  it  only  makes  sense  to manage your money smartly  to
	minimize finance  charges.  The technique i described in the base
	note and used  this  month i believe gets you the maximum savings
	in that situation.
	
	Now, if i could only solve the problem of figuring out what to do
	with all this money i saved.  :-)  harrY  

	

    	Most credit cards also have checks that you can use for purchases.
    I used to pay my MASTERCARD bill with my Visa checks and my Visa
    bill with my MASTERCARD checks. Although I had to pay interest on
    the 'cash advances' i.e. checks, I never had to pay interest on
    the purchases. My account balances kept increasing steadily but
    I had a great credit rating because as far as they were concerned
    I paid my bills in full on time each month and I was a good customer
    by using the checks.
    	This does not work if you try to pay your Visa bill with a Visa
    check because they won't loan you the money to pay their bill.