Make money off a credit card?

[sweeps]

In most states you need a license to invest money that is not yours.

The money is yours. You borrowed it. That is not the same as being someone's broker.

Being a licensed stock broker and long term financial planner I have studied and tried numerous times to use this credit card tactic for myself and other clients.

You haven't studied hard enough then. Lots of people do this and it works. Are you going to turn into a millionaire doing it? No. But it's an easy way for a disciplined person to earn extra cash each month.

There are plenty of mutual funds and ETF's that you could invest your return into that could earn a much greater sum of money for you.

Yes, but with risk of course. The interest rate arbitrage discussed in this thread has little risk, again assuming you know what you're doing.

[safari]

Safari, I agree with you also. I have done this on a small scale also. I just wish I could get more offers with no transfer fees.

I didn't get any of those offers in the mail. I found them online and applied online. After I got approved, I moved my credit line from other cards from the same bank to the new card. For example, I got approved for a Bank of America credit card with $12,000 line. I had an old Bank of America card with $44,000 line, so I moved $43,000 to the new card, making it $55,000 and leaving $1,000 on the old card. Now I was able to transfer $55,000 directly to my savings account at Countrywide (Bank of America did it over the phone and it took less than a week). I also applied for American Express and Citibank credit cards with 0% APR on balance transfers and no transaction fees. I did the same trick and moved the credit lines from my old accounts with those banks to the newly opened cards, which is how I was able to transfer $137K. Citibank and American Express wouldn't transfer the money to my bank account, so to get around that I asked them to transfer balance from my Bank of America card, and then called Bank of America and transfered the money to my savings account.

[safari]

In most states you need a license to invest money that is not yours. This is the reason why online brokerage firms have consistently turned people that would not otherwise invest into small scale investors overnight. Being a licensed stock broker and long term financial planner I have studied and tried numerous times to use this credit card tactic for myself and other clients. We always made some money but a 3.15% return like you had is just not something you should be investing in considering the credit concerns for the future.

It would be a terrible shame to have to pay anything other than the prime rate on larger home loans or other borrowed monies in the future. There are plenty of mutual funds and ETF's that you could invest your return into that could earn a much greater sum of money for you.

You're claiming to be a financial expert, but you fail to realize the simple fact that the money I borrowed is now my money, and I can do anything I want with it, as long as I fulfill my obligations and pay my bills on time. Again, the credit concern that you're talking about is a short-term concern. Once I pay off all my cards at the end of the introductory period, my credit score will immediately improve because my credit utilization ratio will drop below 5%. I am not going to take a risk with mutual funds and ETF's because I have to pay this money back in less than a year, which is why I am putting it in savings and CD's. As a financial planner you should know this. Mutual funds and ETF's are long term investments, which have their own place in my portfolio. I will gladly take $3K+ a year after taxes with no risk for a temporary dip of my credit score. If I was planning to seek credit within the next year, that would be a different story.

[Broken Arrow]

There are plenty of mutual funds and ETF's that you could invest your return into that could earn a much greater sum of money for you.

Er, at the risk of dog-piling, I don't think mutual funds and ETFs would've been appropriate for this kind of situation anyway, since the 0% interest rate on the loan will expire after 12 months. Add on the fact that the loan has a monthly minimum payment.... Probably the only suitable fund is Money Market, but I don't think they're paying that well right now anyways.

But I agree that the risk would the biggest obstacle, especially with ETFs since their prices can fluctuate like a stock. And for only one year, in a down market? Tack on any creation/redemption fees (if any), and you're looking at a great way to lose money!

[JohnCPVT]

137k? that is a lot of debt, even though you are making money from your credit card debt, won't all that affect your credit score? it'll most likely lower it like crazy...

[Broken Arrow]

137k? that is a lot of debt, even though you are making money from your credit card debt, won't all that affect your credit score? it'll most likely lower it like crazy...

Yeah... but the debt is countered by the fact that the money is liquid, safe, and making interest. It's not something that's recommended unless you don't need your credit score for anything anytime soon, and you stay on top of it.

[hellodeli1]

How much money can you make

I've debated this a bit and haven't come to a conclusion except that nothing in life is free. The trade off is that if you forget to pay you get hit with fees and you also negatively impact your credit score along the way, but it seems like a relatively safe way to pocket a few extra bucks.

Who among us can't use a few extra bucks?

[slimcustomer]

SIS comes back with the App-O-Rama FAQ - AKA MAKING THOUSANDS OF $$ FROM CREDIT Link AOR stories and post your successes

All hail SIS the father of the app-o-rama! He's probably helped people make and save hundreds of thousands of dollars over the years.