Good old days of interest rate arbitrage...

jeffysdad · 04:42 AM

Back in the day (2006-2007) I had a B of A Mastercard with a $55,000 limit. Before they spent all that money to acquire office furniture and Merrill Lynch they were apparently feeling flush enough to offer me a cash advance up to my credit limit at 0% for 9 months (maybe 12, I forget) for a mere $75 (the capped balance transfer/cash advance fee at the time).

I took that money and put it in an ING Direct savings account, which at the time -- back in the day -- was paying an interest rate at least worth mentioning, although I forget now exactly what.

When it was all done I made around $1,200 for doing almost nothing. It sure felt good to make some money off the banks after years of paying interest (I'm now debt-free and pay off my Chase Freedom every month).

Does anyone else have stories about interest rate arbitrage or other ways that you've made money from credit cards (besides the obvious points/cashback)?

Mogul of Pineapples · 12:32 AM

You know nowadays it seems like all those opportunities are gone. There was a whole art of how to do credit card arbitrage with the interest rates and make money and some were making thousands like you said. This was especially lucrative when CDs were paying 5 to 7% and you could do a 0% balance transfer offer on a high limit credit card for 12 months. On 50k or 100k you would be pocketing several thousand dollars. At least as of now there's not much opportunity out there to do things like this. Even the points and best cashback credit cards have scaled back their programs. It's too bad because all of us with good credit are being punished for all these delinquents.

Cucumber · 11:35 AM

Office furniture.... LOL!!

Wasn't it Merrill Lynch too that the CEO spent $300k re-doing his private bathroom at his office?

11:26 PM

Ye, I got declined times. Confused...

04:42 AM	#1
jeffysdad Platinum Member Join Date: Apr 2009 Location: Texas Posts: 98	Good old days of interest rate arbitrage... Back in the day (2006-2007) I had a B of A Mastercard with a $55,000 limit. Before they spent all that money to acquire office furniture and Merrill Lynch they were apparently feeling flush enough to offer me a cash advance up to my credit limit at 0% for 9 months (maybe 12, I forget) for a mere $75 (the capped balance transfer/cash advance fee at the time). I took that money and put it in an ING Direct savings account, which at the time -- back in the day -- was paying an interest rate at least worth mentioning, although I forget now exactly what. When it was all done I made around $1,200 for doing almost nothing. It sure felt good to make some money off the banks after years of paying interest (I'm now debt-free and pay off my Chase Freedom every month). Does anyone else have stories about interest rate arbitrage or other ways that you've made money from credit cards (besides the obvious points/cashback)?

12:32 AM	#2
Mogul of Pineapples Centurion Member Join Date: Jun 2008 Location: Where the smog from the 101 freeway coats my home's windows... Posts: 634	You know nowadays it seems like all those opportunities are gone. There was a whole art of how to do credit card arbitrage with the interest rates and make money and some were making thousands like you said. This was especially lucrative when CDs were paying 5 to 7% and you could do a 0% balance transfer offer on a high limit credit card for 12 months. On 50k or 100k you would be pocketing several thousand dollars. At least as of now there's not much opportunity out there to do things like this. Even the points and best cashback credit cards have scaled back their programs. It's too bad because all of us with good credit are being punished for all these delinquents. __________________ “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently.” -Warren Buffett Current Cards: American Express: Blue Cash, Simply Cash Bank of America: Visa Financial Rewards Platinum Plus Chase: Rewards Visa, Amazon Visa Discover: More Current Everyday Card: American Express Blue Cash

11:35 AM	#3
Cucumber Centurion Member Join Date: Apr 2008 Location: Zuma Posts: 456	Office furniture.... LOL!! Wasn't it Merrill Lynch too that the CEO spent $300k re-doing his private bathroom at his office? __________________ OBAMA Stop talking crap about him and give him a chance!

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11:26 PM	#4
creditorfinds Guest Posts: n/a	Ye, I got declined times. Confused...