# Warning: CIBC 0% interest balance transfer visa cheque is misleading



## dbw

A couple of years ago, I've got 0% interest offer from MBNA master card. I signed up to transfer some loan balances, aside from the standard 1% transfer fee, I saved a lot of interest during the offered period, there was 0 interest because I don't charge anything to this card and pay the minimum amount on time every month, paid it off in full at the end.

Last month, I've received another similar offer from CIBC visa, so I thought "great, I can save some interests again", I then transferred my credit line balance to it, there was 1% standard transferred fee which was expected. 
I called them up to ensure that this balance should be classified as no interest as long as I pay the minimum amount every month, however they told me that THERE WILL BE INTERESTS every month on the 1% balance transfer fee, I told them that I would pay off this transfer fee in full on top of the minimum so that there will be no interest. The customer service rep told me that I cannot pay off the transfer fee, what ever I pay monthly will be split between the borrowed amount and the transfer fee with % proportional between the 2 amounts, hence only 1% of my payment would be applied to the transfer fee, this is completely B*LLSH*T (pardon my French). 
Their no interest is absolutely MISLEADING as they will collect interests throughout the entire offered period on the 1% transferred fee at their extremely high interest rate.
So this is a warning to all: do NOT use the 0% interest of balance transfer offer from CIBC, it's load of crap because you'll be paying a lot of interests on the balance transfer fee that you will never be able to pay off unless you pay off the entire borrowed amount which defeats the whole purpose.
CIBC, give your head a shake, this is the last time I deal with this bank, will pay off this amount cancel their visa along with all other accounts.

I'm extremely mad as I was tricked with their misadvertising, extremely disappointed that 1 of Canada's biggest bank is a lying thief.


----------



## Jungle

Im sure its in the fine print. But the issue is, among with everything now, why is it so confusing and non transparent up front?


----------



## the-royal-mail

I understand how you feel. And I agree with your points.

However, pretty well all the banks (as well as ins and cell phone companies) are doing this sort of crap these days. This will continue as long as our society continues to blame the victim for this sort of thing and there is no accountability for the predators who put out these traps.


----------



## Charlie

i thought there were new ordering rules to prevent this?? with payment over your min going to the highest rate pool first. Maybe call a different rep and see what they say, or read the fine print yourself to understand their ordering.

the us version is noted here: http://www.creditcards.com/credit-c...dit-card-payment-allocation-trickery-1282.php but I thought I had received something similar for my Canadian card????

When I got the 0% offer on MBNA for a card I'd applied for years before (to get free stuff at a hockey game) I got nailed for a couple hundred dollars as I'd checked the 'free insurance' box on my application. So I was charged a fee based on outstanding balance until I cancelled it. No retroactivity allowed. They also constantly call with 'free offers' (as long as you don't carry a balance), and new promotions to spend more money -- highly misleading and serious pressure, no wonder so many people get in trouble. They are the true old school drug pushers.

But even if they charge high rates on the fee (which I don't think they can) it really increases your rate by 1% x 20% -- or about 0.2% -- likely still a good deal -- but maddening to be subject to those tactics.


----------



## Addy

Like Charlie, I thought there were new laws brought in recently to prevent this.


----------



## MoneyGal

The new regulations provide that when you make a payment on your credit card above the minimum amount, that payment must be applied to the balance with the highest interest rate first, *or proportionally to all transactions*. 

Under the previous regulations credit card issuers could apply payments however they wanted, such as applying payments to the lower interest balances, resulting in higher interest payments.

More detail: http://www.fcac-acfc.gc.ca/eng/partners/campaign/rulescc/index-eng.asp

http://www.fin.gc.ca/n08/data/09-048_1-eng.asp


----------



## Charlie

thanks MG. Ouch!


----------



## Easy Does It

To think a bank would give you something for nothing is quite naive. If you really want to get back at the banks, spend your own money and not theirs. On another note, there is nothing french about the word B*LLSH*T


----------



## Uranium101

Rbc gave me a free loan for 6 months.
No balance transfer fee, no interest. No catch.


----------



## arrow1963

So to be clear, if you're transferring $1000:

A) there is a fee of $10, which you were aware of

B) over the course of the year, they will be charging you 20% interest on the $10, which will be $2

So it costs $12 to transfer instead of $10? Unless I've misunderstood that doesn't seem like that big of a deal to me. I know, I know, it's the *principle* of the transaction that offends, but I'm always surprised when people think they've found a way to take advantage of special deals on insurance, credit cards or cellphones and find out that these contract-based companies really do know what they're doing, and that lunch wasn't as free as you had hoped.


----------



## dogcom

Easy Does It is right there is never anything for free. Sure one might get six months free or whatever but there is always a reason why someone would give you something.

Go get a free oil change and see what they will try to do to you once they have your car.


----------



## dbw

MoneyGal said:


> The new regulations provide that when you make a payment on your credit card above the minimum amount, that payment must be applied to the balance with the highest interest rate first, *or proportionally to all transactions*.
> 
> Under the previous regulations credit card issuers could apply payments however they wanted, such as applying payments to the lower interest balances, resulting in higher interest payments.
> 
> More detail: http://www.fcac-acfc.gc.ca/eng/partners/campaign/rulescc/index-eng.asp
> 
> http://www.fin.gc.ca/n08/data/09-048_1-eng.asp


Thank you for this info, I will bring it up with them.


----------



## dbw

dogcom said:


> Easy Does It is right there is never anything for free. Sure one might get six months free or whatever but there is always a reason why someone would give you something.
> 
> Go get a free oil change and see what they will try to do to you once they have your car.


I don't disagree that there's nothing for free, hence the 1% "transfer fee". I believe the intention of this offer is to get you owe them money on their credit card so that you either end up paying interests after the "free period", and also if you use the card, they get their fees from vendors for all the charges.

My issue is their misleading advertisement of "0% INTEREST" when they actually do charge interests on the transfer fee and don't let you pay it off.

I have my personal proof that it's not the same with other banks. I used similar from MBNA master card awhile ago and got NO interest for the entire period during the offer, there was no trick, just had to pay off the transfer fee on the first payment and made minimum monthly payment on time. I thought CIBC's no interest offer would be exactly the same however it turned out to be a dirty trick.

My posting is to warn people about CIBC's "misleading" advertisement, and if anyone consider to use a similar offer from any banks, make sure you call the bank first to confirm if it is true with no interest.


----------

