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Sorrento Muddbugs 
LSU Fan
Member since Sep 2011
559 posts
| Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 11:18 am)
and just start over from scratch? It's 0% until July 2013, CC balance is currently $7,500. Mutual Fund is just over 10k. If I don't pay it off now, this would put me spending ~$1,700 a month to have it paid off before the 13.99% interest kicks in. I want to pay it off and move on, while my wife wants to wait - since it's "free money". What would MT do?
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PurpleAndGold86
LSU Fan
Houston, TX
Member since Jun 2012
5310 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 11:21 am to Sorrento Muddbugs)
At the very least, there is no point in paying it off in whole until July. Keep making whatever minimum payment you have to and then make a lump sum payment at the end if that is the route you want to take.
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foshizzle
LSU Fan
Member since Mar 2008
25123 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 11:25 am to PurpleAndGold86)
quote:
Keep making whatever minimum payment you have to and then make a lump sum payment at the end if that is the route you want to take.
This.
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Oenophile Brah
LSU Fan
RDV
Member since Jan 2013
923 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 11:25 am to PurpleAndGold86)
If you can afford the $7500, take advantage of the free time they are offering.
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jso0003 
Auburn Fan
Birmingham/Atlanta
Member since Jun 2009
4456 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 11:31 am to Sorrento Muddbugs)
I've had $2500 sitting on a Discover card at 0% for about a year.
Just make sure you dont spend that money you were planning on using to pay it off.
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bryso 
Clemson Fan
The Real Death Valley
Member since Dec 2006
26768 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 11:33 am to jso0003)
quote:
Just make sure you dont spend that money you were planning on using to pay it off.
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Hammond Tiger Fan 
Southern Fan
Hammond
Member since Oct 2007
10002 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 12:01 pm to Sorrento Muddbugs)
This is the route I would take.
I would not touch the Mutual Fund money. Keep taking advantage of your 0% interest until it runs out. The month before it's scheduled to end find you another card that's offer you 0% interest and transfer that balance over to the new card. I'm sure you're getting these offers in the mail all the time. That should give you an extra 18 months or so to pay off the balance.
I used this strategy to pay off my wife's credit card bills that she racked up as a college student.
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PurpleAndGold86
LSU Fan
Houston, TX
Member since Jun 2012
5310 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 12:09 pm to Hammond Tiger Fan)
quote:
I would not touch the Mutual Fund money. Keep taking advantage of your 0% interest until it runs out. The month before it's scheduled to end find you another card that's offer you 0% interest and transfer that balance over to the new card. I'm sure you're getting these offers in the mail all the time. That should give you an extra 18 months or so to pay off the balance.
This route works, however, I wouldn't think of doing this if I was going to try and get a loan anytime in the near future. Opening and closing accounts isn't the greatest thing in the world for your credit, especially if he had to open a couple in order to get 0% the whole time.
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Hammond Tiger Fan
Southern Fan
Hammond
Member since Oct 2007
10002 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 12:18 pm to PurpleAndGold86)
quote:
This route works, however, I wouldn't think of doing this if I was going to try and get a loan anytime in the near future. Opening and closing accounts isn't the greatest thing in the world for your credit, especially if he had to open a couple in order to get 0% the whole time.
You don't open and close the accounts simultaneously. You open the new account, transfer the money, and wait a few months to close the old credit card if you don't want it anymore. By the time the new account promotion ends, most are 12-18 months (although I got one promotion yesterday in the mail for 0% for 22 months), if you need to do it again it won't affect your credit score much b/c of the time that has lasped.
This is the simpliest way to achieve his goal while not touching the Mutual Fund money. It also gives him the ability to manage his monthly cash flow better as well.
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PurpleAndGold86
LSU Fan
Houston, TX
Member since Jun 2012
5310 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 12:27 pm to Hammond Tiger Fan)
quote:
You don't open and close the accounts simultaneously.
Simultaneous doesn't have anything to do with it. opening up credit cards effects your credit score because they have to run credit checks. Anytime that happens it can lower your score. Nothing significant, but it will still lower.
I am not disagreeing with your process as it is certainly an alternative. However, this is definitely something to keep in your mind if using that approach.
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Sorrento Muddbugs
LSU Fan
Member since Sep 2011
559 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 12:42 pm to Hammond Tiger Fan)
quote:
I would not touch the Mutual Fund money. Keep taking advantage of your 0% interest until it runs out. The month before it's scheduled to end find you another card that's offer you 0% interest and transfer that balance over to the new card. I'm sure you're getting these offers in the mail all the time. That should give you an extra 18 months or so to pay off the balance.
Yea, I really don't want to touch the MF money and neither does the wife. I am hoping to have the balance on the card, at least 1k less each month until July. Keep in mind, that I am still using the card for almost everything since it's 0% and it's a Venture Card and I have close to 40k in points.
If I get an offer for no transfer fees and at least 12months 0% I'll take it. I also monitor my credit often, so I'll be fine when it comes to opening and closing new cards. I closed one out this month, that I had for 2 years with 0%, but the regular rate was 29% and I had no need for it.
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PurpleAndGold86
LSU Fan
Houston, TX
Member since Jun 2012
5310 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 12:48 pm to Sorrento Muddbugs)
Sounds like you have a good plan.
Another tidbit though. You mentinoed you closed a card out that you had for 2 years. Having credit cards opening for a long amount of time is very good for your credit. You want to leave credit cards open and keep that tenure. Just an idea.
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Sorrento Muddbugs
LSU Fan
Member since Sep 2011
559 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 1:08 pm to PurpleAndGold86)
Yea, I have a few credit cards dating back to 2005. Had some all the way back to 2001-2003 but I closed them out, from the advice of my mortage lady when I got my first house. And I hate that decision to this day, but I didn't know better back then. I wish I could open a few of them back up using those dates, I'd be somewhere in the 800's by now.
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KG6
LSU Fan
Member since Aug 2009
620 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 1:17 pm to Sorrento Muddbugs)
What's your credit limit on that card? If you have more than 30% of your limit, I would pay down to below that. It can affect your credit score. Other than that, I would just pay the minimum and pay a lump sum before the interest kicks in.
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Sorrento Muddbugs
LSU Fan
Member since Sep 2011
559 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 1:38 pm to KG6)
quote:
What's your credit limit on that card? If you have more than 30% of your limit, I would pay down to below that. It can affect your credit score. Other than that, I would just pay the minimum and pay a lump sum before the interest kicks in.
10k limit, so thats 70%, but ALL of my card limits are around 70k. So my untilization on a whole with credit cards is $7,100 of 70k = 10%.
Isn't this what they look at? Or do some look at each card individually?
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Dead Mike
LSU Fan
Cell Block 4
Member since Mar 2010
1501 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 1:40 pm to Sorrento Muddbugs)
quote:
and just start over from scratch? It's 0% until July 2013, CC balance is currently $7,500. Mutual Fund is just over 10k. If I don't pay it off now, this would put me spending ~$1,700 a month to have it paid off before the 13.99% interest kicks in. I want to pay it off and move on, while my wife wants to wait - since it's "free money". What would MT do?
Have you thought about a 0% balance transfer? It's kind of putting off the inevitable but there are some offers like that out there, I've thought about doing this myself.
Edit - haha, I see that it's been covered
This post was edited on 1/30 at 1:42 pm
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PurpleAndGold86
LSU Fan
Houston, TX
Member since Jun 2012
5310 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 1:43 pm to Sorrento Muddbugs)
quote:
So my untilization on a whole with credit cards is $7,100 of 70k = 10%.
Isn't this what they look at? Or do some look at each card individually?
They look at it on the whole, not an individual card by card basis. Try and raise your credit limits too. Usually they will do that, and that just gives you a little more freedom as well.
ETA: Actually they look at both factors. Individuals basis and overall basis. Definitely good to raise the credit limits as often as you can.
This post was edited on 1/30 at 1:47 pm
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ItNeverRains
LSU Fan
Franklin, TN
Member since Oct 2007
4598 posts
| re: Should I pay off a 0% Credit card bill with my Mutual Fund $$ (Posted on 1/30/13 at 2:28 pm to Sorrento Muddbugs)
A loan officer advised you to close a credit card? That's a new one for me
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