Read Your Holiday Mail - Especiially The Credit Card Apps

So you've been receiving junk mail from credit card companies all year long trying to get you to sign up, but you've resisted or just plain thrown them out. Is your credit good? Would you be approved for credit? If so, then start reading your mail RIGHT NOW!

Not one month ago I held two cards, one a points card which is kinda nice, but not really great other than the 7.99% interest rate. the other is the first card I ever had which despite the 16.99% rate, I've decided to keep for credit rating purposes. Obviously if you've got to use one card you can see which one it would be....

So, I get an offer from my unfriendly first card whereby they offer to let me make a balance transfer or just write a check to myself for up to the limit of the card. On top of this the rate will be 1.99% fixed until I pay it off or miss a payment. Let me say, this is a good deal since my school education loans are at 3.75%.

Thankfully I didn't rip it up and throw it away. The next day I get a piece of mail whereby I'm offered 0% through March 2007 on all purchases if I transfer a balance upon opening. This isn't a great deal except for the fact that I've just found about the offer above.

So, long story short... I pay off all balances on the card with 16.99% so I can write the biggest check possible on it (my credit line). I then initiate a balance transfer from my first car to the other card to get the 0% on purchases. I Use the money I've just taken on the 16.99% and pay off the balance transfer on the new card AND a bunch on my points card at 7.99%.

The end result? I've got a card that I can spend on for 0% through March 2007 with no balance, I've locked as much debt as possible at 1.99% fixed (home equitors eat my dust) on my first and crappiest normal interest rate card, I've reduced my balance on my points card and increased my credit "worthiness" in the next 12mo by taking on a new credit card.

Now, just in case there are some morons in here that aren't thinking about the downside risk --- if I can't pay the minimum on the 1.99% loan, it defaults t 29.99%. Now the minimun is a tiny payment, but don't space out the payment otherwise you'll be getting what is coming to you - - bigger payments as the interest rate goes through the stratosphere. Oh and unless you're sure you can make payments, just ignore this whole scenario.

Otherwise the moral of the story is that credit card companies prey on people who need more spending cash around the holidays. They don't anticipate that some people may have plenty of spending cash and be able to take the opportunity to take all their lenders to the cleaners. Bottom line - even if you don't think you need another credit card - open your mail around the holidays because thats when the credit card companies go trolling for suckers, and thats when the best deals arrive in your mailbox.