Yes, this is a possibility but cash advances amount to a fairly small amount of money. Given the huge interest rates for cash advances, I
*highly* doubt this is a significant problem.A lot more likely, though food and toys are just as likely.
Years ago I dropped a credit card somewhere in Allston Rock City (natch) and didn't realize it and shut it down until the next morning, but someone had already been using it. But from the list of charges it looked like basically all they did was first charge about $200 worth of shampoo and toiletries at CVS, and then treat themselves and their friends to a little dinner at Pizzeria Uno that totaled not much more than $100. On an American Express with a $15,000 limit.
I thought "Well that was neighborly of them. Some people might have decided to go a lot more upscale on someone else's dime"
Someone grabbed my debit card numbers, a couple years back. It was used once, across town at a TJ MAX. They bought a $50 sweater, or some such before I got it turned off. No skin off my nose either way. Just a couple of phone calls.
Particularly since it was "Da Man's" money.
Charles Schwab will allow you to purchase about 3 times your account value. So, if you open an account at 10K, you can purchase 30K of stock. It's called margin. Very simple. If the market drops significantly, they will give you a margin call and ask for more money to cover your bet. Meanwhile. interest rates on the credit card are only 15% a year or a little more than
1% a month. So, if I can borrow 10K on my credit card and margin it out to 30K, and invest in the market, and make 2% in a month, or $250, I can come out ahead since the interest is only 15% of 10K or $125 a month.15% is low for cash withdrawals. The cards I have rates close to 15% for credit and double that for cash withdrawals. I don't care about either, so there could be cards more optimized for deadbeats. OTOH, if you max out a card, its rate will skyrocket. You also have to pay it back monthly, so it's not great leverage.
I thought there were no interest charges on credit card balances that were paid back within 30 days. So, the question is, can you take a cash advance on a credit card for 30 days, invest in the market, do some day trading, and then pay back off the credit card at no interest and make a profit? Another question is: If you have no assets, why would you bother to go bankrupt since there are no assets to collect?
I thought there were no interest charges on credit card balances that were paid off within 30 days. So, the question is, can you take a cash advance on a credit card for 30 days, invest in the market, do some day trading, and then pay off the credit card at no interest and make a profit? Another question is: If you have no assets, why would you bother to go bankrupt (chapter 7) since there are no assets to collect?
Nope. The interest on cash advances starts the day of the advance. The world doesn't work the way you think it does.
So, I'm just out the 35K I loaned to the party going bankrupt? What recourse do I have? Do I get any interest? Do I get anything back? If they have no assets, what can I do? The bankruptcy rules don't seem fair.
Secured creditors, the government, employees owed actual pay etc. get first dibs. Unsecured creditors are last in line and typically get peanuts or nothing.
The secured creditors typically don't pull the plug until *their* money is in jeopardy. They don't care much about unsecured creditors. By that time it is too late for the unsecured guys.
The bankruptcy protection stops the creditors from hassling the debtor and they get to deal with a 3rd party 'receiver' who divies up whatever applicable assets remain (taking a healthy income for their time) according to the rules.
--sp
-- Best regards, Spehro Pefhany
Don't take any payment from an unsecured credit card that you can't afford to write off. Credit cards are a "convenience item"; the reason you accept them as a small business at all is because you know you have
15 customers a week who wanna pay small to moderate amounts of money for your product or service but are gonna balk if you demand it in cash, and there's a maximum payment charge you're willing to accept (which AFAIK is OK with most merchant agreements.)When one starts getting up into the thousands or tens of thousands of dollars um sorry buddy, we're doing a legally binding Net 30 or "due upon receipt" contract with legally enforceable penalties for non-payment, or money order, or suitcase of cash if you've got it. Yes, you can put your deposit on a credit card, sure. Not the total balance.
Sweet Jesus anyone who say just lets some Internet rando make an online payment to their business for thousands of dollars with an unsecured credit card and ships the gear out the very next day by FedEx like a good little boy without doing due diligence is behaving like a madman.
Nobody knows the real situation but dude I gotta say from your posts it sounds a lot like the reason you're so miffed is that you were trying to run a hustle but got out-hustled by a better/more unscrupulous hustler than you were.
You get in line with everyone else. Actually, you're at the back of that line. No, you're unlikely to get a dime. h
billbowden wrote on 7/17/2017 1:05 AM:
Was the debt to you discharged in the bankruptcy? I think you have to file to be able to recover anything. Then again, I think you have to be informed of the proceedings, but I'm not sure. My understanding is they have to list all the debts they want discharged and inform the debtors. The debtors have to file in court to attempt to recover anything. It is up to the court to decide what debts can and should be paid and which are canceled. If you never filed in the bankruptcy you may not have any recourse unless you can show you were never informed of the proceedings.
I'm not a lawyer, so I don't know for sure.
-- Rick C
Bill Bowden wrote on 7/16/2017 7:11 PM:
It is not full balances that have a grace period, it is only purchases. They are typically however long from the transaction to the last day you can pay the bill without being late which is nearly a month (the billing cycle) plus the number of days before the statement date you make the purchase.
Cash advances or funds transfers (paying off another card) typically not only collect interest from the day of transaction but also incur a fee of some few percent, often 3%.
-- Rick C
This makes sense since the card issuer makes money from the merchant on a purchase (something like a percent or two, which easily covers the interest cost, risk and then some) but makes nothing when issuing a cash advance.
--sp
-- Best regards, Spehro Pefhany
There is often an exception for paying off another card. There are deals where there is zero interest for a period (sometimes a year).
Exactly. They also don't want you using the card as margin on investments. CCs are risky enough as it is.
Spehro Pefhany wrote on 7/18/2017 6:50 PM:
Did you miss the 3% fee?
-- Rick C
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