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I currently have a $7000 Credit Balance on my Capital One account (doing 0% BT from the other account) and my credit line of the card is $4300. I want to use the Purchase Chech that they send to me and write the chech to myself for the total of $7000 and deposit it to my bank. What are the consequences of doing this. Many thanks.


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Don't do it. Your check will bounce.

The most you can write a check for is $4300. (I would do a few dollars less to be on the safe side.) Once the first check clears, your credit limit will be restored and then you can write another check.

I am assuming that you do not use your credit card for anything else. As soon as you get an approval for a purchase, your credit limit is reduced by the amount of the approval, even if you have a credit balance. Your credit limit does not get restored until the charge clears several days later. A check for more than your available balance will bounce even if you have a credit balance for more than your available balance.




Thanks very much I almost do it since the check will expire this month. I am glad that I ask for help. Also, I will not be charged for interest isn't it? Because I have a credit balance.

That's right.
And you better hurry. The check has to clear (not just be cashed) by next week Tuesday.

[Q]The check has to clear (not just be cashed) by next week Tuesday. IME, cap1 does not require the check to CLEAR by the date, only to POST (this has worked several times for me.) Otherwise uggabugga's advice is good, as usual. (uggabugga, have you confirmed that cap1 will bounce checks in these cases? I haven't had this experience, but have been told that some CC issuers have while others haven't had a problem.

The better strategy might be to request a refund of a credit balance first, then write a purchase check.

Generally speaking, it's best to avoid having negative balances like this. Better strategy is to write the purchase check first, then BT to it (once apiece over 2 cycles in your case, since your CL was less than the BT.)


OK. Here's what I will do. Write a check for $4000 which means I still have a credit of $3000. Wait till the check is clear and write another check for $3000. But by that time the remain check I have already expired. What will I do next? Call for Credit refund?

Given that the checks are drawn on Capital One Bank, they clear the same day they post. By "clear" I mean clear Capital One Bank. If you are thinking by "clear" I was referring to the date that the bank where you deposited the check lets you withdraw it, I was not referring to that.

Don't worry. You'll get another check next month. Count on it.
Or call and ask for a refund if you don't want to wait that long.

Ooops, missed DaveHanson's other question: No I haven't confirmed this specific question. I do know that the terms and conditions say the check is valid up to your available credit limit. I do know that your available credit limit is not increased by your credit balance and that attempts to use your credit card will fail. (I learned this the hard way when a duplicate authorization got posted to my account.) I do know that when your check posts, your available credit is decreased by the amount of the check and not increased again until the following morning.




DaveHanson said: [Q](uggabugga, have you confirmed that cap1 will bounce checks in these cases? I haven't had this experience, but have been told that some CC issuers have while others haven't had a problem.I'd say as a blanket statement, I'd assume any charge / check written for more than your available credit would bounce, even if you have a massive negative balance.

I *have* seen some credit card companies report my available credit as higher than my actual credit line when I've had negative balances. These might be fair game and might work just fine, but I wouldn't attempt it without getting confirmation from a CSR (and only after noting the time, date, and name/number of the CSR in case of a bounced check). As I'm lazy, really don't want to talk to CSRs, and like to play it safe, I've always limited myself to multiple checks / charges at less than my available credit limit.

Balance credit refunds don't count -- I've requested $17-18K refund checks on my piddly Bank of America Gold Card which has a $1500 credit line. (More a matter of spite and vindictiveness than anything else -- I was trying to make a point.)

DaveHanson said: [Q]The better strategy might be to request a refund of a credit balance first, then write a purchase check.Once you've requested the balance credit refund, it's all over -- shred the check, don't cash it. I can just imagine the request for the balance credit refund generating a check of $7K and posting a day or two after he's deposited the purchase check for $4K or something. Suddenly, instead of a negative balance, he has a $4K positive balance and is accruing interest on money unintentionally borrowed.

Personally, I'd deposit the purchase check now for the full amount of his credit line -- give it directly to a teller, no ATMs, so you have the full available balance immediately -- and then call up and request the balance credit refund for the rest once the purchase check has posted to the CC account.

Capital One's purchase checks are a good way to get interest-free money. Write a purchase check immediately after your closing date and you will have use of the funds for almost two months. No transaction fees and no interest.

uggabugga, it looks like I was unclear above...

In my experience, if I have a cap1 "purchase check" that expires June 1, I can deposit it ON June 1--meaning it "posts" to my credit union that day--and cap1 has no problem honoring it, even though it won't "post" to my cap1 account for 3 more business days. Worked several times for me.
[Q]Don't worry. You'll get another check next month. Count on it.Not in my experience. I get them only sporadically, and recently I've received them less and less frequently.


mbaker4096 wrote, [Q]As I'm lazy, really don't want to talk to CSRs, and like to play it safe, I've always limited myself to multiple checks / charges at less than my available credit limit.I agree and follow this same practice as well. It's even necessary with an AMEX business LOC, as I so painfully found out last year and have detailed here.[Q]Balance credit refunds don't count -- I've requested $17-18K refund checks on my piddly Bank of America Gold Card which has a $1500 credit line. Ah, but sometimes they do. Certain banks go nuts when you try to do this....I've heard MBNA is especially bad on this score. [Q]Suddenly, instead of a negative balance, he has a $4K positive balance and is accruing interest on money unintentionally borrowed. That assumes no grace period, which cap1's purchase checks have.[Q]Personally, I'd deposit the purchase check now for the full amount of his credit line -- give it directly to a teller, no ATMs, so you have the full available balance immediately -- and then call up and request the balance credit refund for the rest once the purchase check has posted to the CC account. A good suggestion--probably the safest stragey posed so far.

DaveHanson said: [Q]mbaker4096 said: [Q]Balance credit refunds don't count -- I've requested $17-18K refund checks on my piddly Bank of America Gold Card which has a $1500 credit line. Ah, but sometimes they do. Certain banks go nuts when you try to do this....I've heard MBNA is especially bad on this score.True, true. I've read the same re: MBNA. I'm just saying that balance credit refund checks don't hold the same limitations re: amount compared to your available credit line -- i.e. it's your money...they'll send you a check for the full amount, even if it's more than you should be able to charge at any given time.

DaveHanson said: [Q]mbaker4096 said: [Q]Suddenly, instead of a negative balance, he has a $4K positive balance and is accruing interest on money unintentionally borrowed. That assumes no grace period, which cap1's purchase checks have.I learn something new every day -- took me a second to realize that these are different than the typical balance transfer checks and post as just another purchase on the account. I don't know that I've ever seen them come in on my Capital One account. Probably have, but they've likely been shredded as I'm nursing a 17K 0% BT balance one my CapOne card right now. <img src="i/expressions/face-icon-small-wink.gif" border=0>



[Q]I do know that when your check posts, your available credit is decreased by the amount of the check and not increased again until the following morning.

So when my available credit increased again I can immediate write another check?

If you have another unexpired check, sure.



Thanks a lot Uggabugga.

Cutting it close... statement closing date is September 16. Purchase checks expire Sunday, September 19. What is best day to deposit at my bank?

(If I deposit on Friday, 9/17, will I get the favorable terms even if check clears Capital One after the expiration date? Or should I deposit 9/15 and hope it doesn't hit my statement 9/16?)

Thanks!

UPDATE: Deposited 9/15 National City did not put a hold on it, tomorrow will transfer to ING Direct Savings Account (pays 2.2%)

FINAL UPDATE: Transaction posted to my Capital One account on September 17, day after statement cycled. Perfect!<img src="i/expressions/face-icon-small-happy.gif" border=0>

I would do on the 15th. I am pretty sure it wont post and show on your statement ending the 16th.


I deposited the check on 08/24 and it posted on 08/27/04.

Another on 09/03 and it posted on 09/09.



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