Wednesday - Aug 16, 2017

How to get Money without any Interest charges


In our yesterdays post, we have discussed the possibility of paying the tuition fees for your family member in USA without a loan issued in India.

It should be noted that, money generated from these methods are usually interest free for a certain period only – 12 to18 months. This method can also be used for generating interest free money if you are making a big purchase(real estate) in India.

Before we go in to the details, we should review the risks involved.

1. You credit score may take a big dip as your credit utilization would have gone up.

2. If you cannot catch up with the payments, you may end up paying interest charges (in some instances, it may be lower than the APR you can get in India)

3. Not all universities accept credit Card payments. If accepted, there is usually a processing fee of approximately 2% (consider this as the loan processing fee in India)

4. If credit cards are not accepted, you may have to do balance transfer to your bank account and pay the balance. this usually involves a 3% fee (an approximate 1% increase if credit cards are not accepted)

5. You may miss out on potential large credit card signup bonuses in the future.

On the positive side, you save on loan processing fee in India and poor exchange rate for converting INR to USD.

Credit Cards with 0% Introductory APR:  

1. Citi Diamond Preferred Card

Citi Diamond Preferred

Citi Diamond Preferred

  • 0% Intro APR on purchases and balance transfers for 18 months; after that the variable APR will be 11.99% – 21.99%, based on your creditworthiness.
  • Balance Transfer Fee: Either $5 or 3% of the amount of each transfer, whichever is greater.
  • No Annual Fee

2. Citi Double Cash Card

Citi Double Cash

Citi Double Cash

  • Earn 1% unlimited cash back on every purchase you make and earn an additional 1% cash back as you pay for those purchases in full or over time.
  • 0% Intro APR on purchases & balance transfers for 15 months; after that the variable APR will be 12.99% – 22.99%, based on your creditworthiness.
  • Balance Transfer Fee Either $5 or 3% fee of the amount of each balance transfer, whichever is greater.

3. BankAmericard Cash Rewards Credit Card

BankAmericard Cash Rewards

BankAmericard Cash Rewards Credit Card

  • 1% cash back on purchases everywhere, every time
  • 2% at grocery stores and 3% on gas for the first $1,500 in combined grocery store and gas purchases each quarter
  • 0% for 12 billing cycles, applies to purchases and to any balance transfers made within 60 days of opening your account

 4. Discover it 

Discover it

Discover it

  • 5% cash back in categories that change each quarter, up to the quarterly maximum. Earn 1% cash back on all other purchases.
  • 0% Intro APR for 14 months on purchases and balance transfers. Then 10.99%-22.99% Standard Variable Purchase APR applies
  • 3% fee for each balance transfer

 5. Capital one Platinum Prestige

Capital One Platinum Prestige

Capital One Platinum Prestige

  •  0% intro APR for 14 months; 10.9%-18.9% variable APR after that on purchases
  •  0% intro APR for 14 months; 10.9%-18.9% variable APR after that; 3% fee on the amount transferred for 14 months on balance transfers
Capital One VentureOne

Capital One VentureOne

  • 0% intro APR for 12 months; 11.9%-19.9% variable APR after that on purchases
  • 11.9%-19.9% variable APR; No Transfer fee on balance transfers
Amex EveryDay

Amex EveryDay

  • 0% intro APR on purchases and balance transfers for 15 months.
  • After that, your APR will be a variable rate, currently 12.99% to 21.99%, based on your creditworthiness and other factors.
U.S. Bank Visa Platinum

U.S. Bank Visa Platinum

  • Special 0% introductory APR on purchases and balance transfers for the first 12 billing cycles
  • 0% introductory APR applies to balance transfers made within 30 days of account opening.
  • An introductory balance transfer fee of 3% of each transfer amount ($5 minimum) will apply to balances transferred within the first 30 days of account opening

9. Chase Freedom

Chase Freedom

Chase Freedom

  • 0% Intro APR for 15 months on purchases and balance transfers.
  • After the intro period, a variable APR of 13.99%, 18.99% or 22.99%
  • Balance transfer fee is 3% of the amount transferred with a minimum of $5.

10. Chase Slate

Chase Slate

Chase Slate

  • 0% Intro APR for 15 months on purchases
  • 0% Intro APR for 15 months on balance transfers
  • No balance transfer fee within the first 60 days from account opening
 Things to know:
  • There is no annual fee on all the above listed Credit cards
  • Some of the cards comes with a signup bonus, which can offset the Credit card processing fee or balance transfer fee.
  • This list may not reflect all 0% intro APR cards available in the market.
  • It may be better for your Credit report, if your spouse can share some of the balance.
  • Use Chase Slate at a later stage, as this card comes with 0% APR and no balance transfer fee (you can transfer balance from other cards when the 0% APR promotion is complete)
  • For Student loans, there may be other resources available to get money for zero or low interest, but these are limited and has certain restrictions.
  • Discover offers student loans and personal loans at a very competitive rates, you may consider consolidating them on to one loan if you are unable to catch up with the payments.

Conclusion:

Credit cards are not only good for Miles and points, but also for interest free money.

If you have thin credit history, you may not get enough credit line to support all your financial needs, but these methods certainly the potential to save some money.

Do proper risk assessment, if you decide to take this approach. This method can also be useful for any Investments in India.

Disclaimer:  Links mentioned in this post do not earn us any commission.

Editorial Note: Opinions, analysis and any calculations shown are authors alone. Information in this post is not reviewed, approved and endorsed by any airlines, frequent flyer programs or financial institutions.

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