A few days ago, a visitor of Smart Balance Transfers contacted me about an issue she had with a credit card check her fiance received in the mail. I have long cautioned against the use of balance transfer and cash advance checks, mainly because there is always a chance that these checks may bounce.

Below is Irina’s experience with a bouncing credit card check from Citibank. Fortunately, she did not incur great expense. However, anyone considering use of these credit card checks should think twice before using them.

From Irina:

 1. My fiance has a credit card with Citibank. He is paying it off and has never incurred in default. His APR is about 7%.

2. At the beginning of June, he received an offer via mail. It was a set of 4 balance transfer checks with 0% APR til December, 2011 and 19.99% APR afterwards, with a 4% fee. In order to use them, he was supposed to call the bank and authenticate them.

3. My fiance saw an opportunity to get some credit card relief and make some payments and decided to take 3,000. He called and validated them. The executive that made sure of that told him that he could write the check to himself, go to a Citibank branch and get cash.

4. We did so on Wednesday, June 23rd, but the cashier refused to do it. She said they were to be deposited in a checking account or pay the credit card with it, which we decided not to do at that time.

5. We went across the street to a Bank of America and deposited a new check into my account.  The money would be available on Friday, June 25th according to the cashier. We were a little upset that the executive had lied to us about the cash, but the 2 day delay was not a problem.

6. Next day, on June 24th, I checked my account online and the deposit appeared as “pending” and available on June 24th, but it did not appear on his Citibank acct. Therefore, he called another representative, told him what had happened and he assured him that there was not a problem and that it would appear within the next couple of days.

6. On June 25th, the money appeared on my account as Counter Credit, but we decided not to take it since it was still not appearing on my fiance’s acct.

7. On Monday, June 28th, situation was the same. He called to find out why it hadn’t appeared on his balance, and up to that point, he was told that the offer was no longer available and that he didn’t qualify. At that moment, the balance was still on my account. I called Bank of America to ask what the procedure was and while we were on the phone call, the funds were retired  without incurring in any charges, there would have been a sea of them had I used the money according to the BA Customer Services agent .

8. My fiance kept calling and got ahold of a manager, who told him that the reason he had been denied was that the bank had called off the offer and decided that they could not afford it since June 8th, that he had thousands of complaints regarding the same offer and that there was a clause in the credit card terms saying that they can retract any balance transfer offer.

9. Today, he received a letter from the bank apologizing and saying simply that we was no longer eligible.

As you can see from Irina’s story, credit card checks can create numerous problems no matter how diligent one is in verifying these deals. The best thing to do with balance transfer checks is to throw them in the trash. Irina was fortunate to have not incurred fees. However, I fear others have been much less fortunate.

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