DogDadNY518 wrote:For fear of jumping into the lions mouth here...
1. I think that most card limits do not allow cash advances up to the full credit limit. So in your scenario to get 10k from two cards you'd need more than 5k CL on each.
2. Cash advances come with fees. Not like APRs for purchases. Straight fees. So even if you immediately balance transferred the 5k each from the 2 cards to the third 0% card, you'd still have cash advance fees to pay. And for 10k total cash advance that would be pretty steep.
3. You still eventually have to pay off the 10k, and yes you may have a year, but you still have to pay it off, and if your flip doesn't come through as you hope, and you can't pay off the 10k in full, you are now paying 23% interest.
4. Yes cards do offer cash advances as a convenience to be used occasionally and sparingly, but cards - all cards - have the right to close any account any time for any reason. period. Read through these boards and you'll see people who are shut down for not using cards often enough, people being blacklisted for product changing just to try to get sign up bonuses. Not using a card often is not illegal. Signing up for a card to get the rewards bonus and then cancelling before the annual fee kicks in is also not illegal. But doing these things don't make the card companies happy. And trust me, its clear that you have no love lost for the banks and don't care about making them happy. But the point others were making is if even is want you are describing is technically legal - you are agreeing to use a product from a private company and they have the right to shut your card down any time for any reason. And what you are describing is not use of their cards they are going to like and would likely get shut down pretty quick.
5. Most importantly, doing this would probably have you under the watchful eye of the FBI. Why? Because while you may be looking at this for a way to get some cash to flip some real estate or whatever it is - this type of thing is also exactly like what terrorists and drug dealers like to do to get cash for their lovely endeavors.
So my suggestion. Go to the bank and ask for a loan.
Finally some useful info! Thanks for taking the time man I appreciate it.
I agree with points 1, 2, and 3. These charges would of course be taken into account when doing the planning, same way you do with points when you deal with hard money loans.
Now point 4 is true, I have read about people getting shutdown trying to get the bonus, other cases where the buy a gift card only to sell it right back and keep the rewards. I got a Macy's and Sears card closed down because I didn't use them for 6 months, and of course I understand they have the right to shut you down if they are not making money on you, I think it's fair.
In my example, if you pay them all fees related to the cash advanced plus the little bit of interest you will accrue until the balance transfer kicks in (sometimes 2 weeks or more in my experience), do you think you will still get red flagged? I mean you are not just getting their bonus and running away with it for free, you are indeed paying them for a service they are offering you, what you do with the funds should be irrelevant, you are just minimizing the amount of money they get to make on you with another strategy, I have seen cards marketed specifically for cash advanced as their main incentive. I feel this comparison is more of an evasion vs avoidance, where the bonus thing is evasion and my example is avoidance, what do you think?
As far as the two 5k cards to be used for balance transfer, I don't know but even if you get red flagged by them I highly doubt they will shut you down if you have a balance and are making payments on time. Can they send your account to collections if you are not using the balance transfer feature in a way that pleases them?
Point 5 I have my doubts, drug dealers usually don't have bank accounts let alone good enough credit to attempt this, is the FBI spending resources to monitor this? maybe I don't know, I sure think it would be a waste of money.
I am involved in RE, I rehab and then sell or hold, thing is hard money is very expensive, and traditional line of credit comes with a lot of scrutiny and paperwork, so I was exploring new ways of financing and thought of this since I have a high limit account that offers cash advanced. Turns out there is a company already doing this for people, advertising it all over face book, so I guess it's not my idea but it serves to prove that it does work, I just saw it while writing this, I'd still like to debate about it tho.