Credit card convenience checks

[marmar]

I don't normally use credit card convenience checks, but I got one in the mail the other day with 0% interest though June 2012. I figured it would be an easy way to pay off a recent home improvement project. When I tried to deposit the check yesterday, the bank gave me some kind of crap about having to put a 30-90 day hold on the funds because they have so much trouble getting the money out of Chase. And something about the collections department having to look into it, and the bank would probably charge me a fee for their trouble.

Now, this check was for a relatively piddly amount. Two years ago, I wrote a convenience check for $2,000 (0% interest for 2 years!!), and I had no problem with the bank whatsoever.

What gives? Has anyone else had a problem like this?


ETA: The bank ended up not depositing the check for me saying I'd be better off just doing a cash advance. Freaking idiots - I can't get the 0% promo with a cash advance!

[phil5185]

I wrote a few $3000 checks in the 2003 to 2005 time frame, I don't recall any holdups or fees. Back when there were 0 BT, 0% interest offers, I had $15,000 borrowed and I 'reset' it once a year with $3000 checks that I put into my checking account to cover the monthly payments for another yr. (I kept the $15k in an Index Fund.)

[❤ mollymouser ❤]

I've never used a credit card convenience check. Could your bank teller be mistaken or misinformed?

[fairlycrazy23]

I"ve had a week hold on one, but not more than that.

[azphx1972]

I haven't had any problems depositing these types of checks in the past, however I haven't seen any offers in a while that didn't come with a 4% or more upfront fee. Check the terms of your offer carefully, if you intend to try to deposit it at a different bank. What kind of bank is this that refused to accept the check? A national bank, local bank, or credit union?

[Deleted]

Just a guess, but maybe it's because of the tough times...people who've lost their jobs depositing one of those checks and writing a check against it, waiting a few days, then closing their bank account and defaulting on the cc bill? I don't know how that would work, but I'll bet somebody who can't cover their bills has figured out a way...

[Deleted]

I just deposit one a few weeks back (TD bank) and had no issue with it.
It cleared withing 3 business days I believe.

[marmar]

Apr 21, 2011 23:34:16 GMT -5 ❤ mollymouser ❤ said:

I've never used a credit card convenience check. Could your bank teller be mistaken or misinformed?

Probably. I'm going to check with another branch this afternoon and see if I get the same runaround.

Apr 22, 2011 2:05:38 GMT -5 azphx1972 said:

I haven't had any problems depositing these types of checks in the past, however I haven't seen any offers in a while that didn't come with a 4% or more upfront fee. Check the terms of your offer carefully, if you intend to try to deposit it at a different bank. What kind of bank is this that refused to accept the check? A national bank, local bank, or credit union?

No, I'm anal about reading the fine print on offers like this. It's a national bank - Wells Fargo.

Apr 22, 2011 5:45:07 GMT -5 @missrigby said:

Just a guess, but maybe it's because of the tough times...people who've lost their jobs depositing one of those checks and writing a check against it, waiting a few days, then closing their bank account and defaulting on the cc bill? I don't know how that would work, but I'll bet somebody who can't cover their bills has figured out a way...

What's irritating, though, is that I've got a few thousand in the bank, so the teller asked the branch manager if they could process/approve the check on a case-by-case basis. But I was still turned away. @#$%&!

[Plain Old Petunia]

Apr 22, 2011 5:45:07 GMT -5 @missrigby said:

Just a guess, but maybe it's because of the tough times...people who've lost their jobs depositing one of those checks and writing a check against it, waiting a few days, then closing their bank account and defaulting on the cc bill? I don't know how that would work, but I'll bet somebody who can't cover their bills has figured out a way...

You don't need to close your bank account in order to default on your credit card bill, you simply don't pay it.

No, I have never heard of placing such a long hold on a convenience check and would consider it unacceptable. I would call the bank and ask for the customer service manager.

[busymom]

I've gotten several of those offers lately, but there is always a 3% to 4% fee upfront, even if there is no interest. If it's a good deal for you, I can't understand why your bank wouldn't honor it. I haven't used one of those checks in a few years, but have never been turned away by the bank. Weird!

[marmar]

Yeah, there's a fee, but the math works out in my favor. I just don't get their turning me away. I've got my mortgage with 'em, they know how much I have in my accounts, I have perfect credit (score's probably in the high 7's or low 8's). They just kept on and on about this list of banks they don't like to accept the checks from because it's so hard to get them to reimburse the money. I have a hard time believing that Chase and B of A are so freaking reluctant to reimburse.

[2kids10horses]

It's a "check". Don't they clear like any other check? Now, when the issuing bank gets presented the check for payment, they have to figure out who is now borrowing money, but I would think all the interbank transfers should go like any other.

[mithrin]

The strange thing is that even if there are worries about defaulting on the CC, why would the Wells Fargo branch care? It would be Chase holding the bag on this one. I have to say I'm leaning towards the problem being somewhere on Chase's end. I can't think of any reason for a WF branch manager to piss off a customer like this unless they really have had problems with Chase. It will be interesting to hear what happens when you try another WF branch.

If you have trouble again at WF (which at this point I'm guessing you will--this type of issue doesn't seem like one a branch manager would cook up just at his branch), there are some other options.
--Try somewhere else you have an account that isn't WF. Other banks might not have this policy.
--Use the check(s) to pay an expense like rent or a CC bill from another bank.
--Put the CC check into the ATM as a deposit and see what WF does then.
--Try to deposit the check at a Chase branch, if you have to, open a new account and get a $150 bonus.
www.chase.com/ccp/index.jsp?pg_name=ccpmapp/shared/marketing/page/chase_checking_052111_158391_sphr&ID=0000012024&advertId=37966

[marmar]

@2kids - Well, that's what I thought. It's just like any other check, so I should be able to deposit it the same way.


mithrin - I'll let you know what the other branch does this afternoon, but I'm anticipating the same outcome. If so, I'm going to head across the street to Chase and just cash it there. And then, the president of Wells Fargo is going to get another very ugly letter from me. (Last time, I sent a letter to the presidents of the mortgage division, and I received no fewer than three letters from three different people in three different cities who were falling all over themselves to kiss my @$$, tee hee hee).

[marmar]

Oh, forgot to mention that I asked to just cash the check. I was told they'd give me the $$$, but that if Wells couldn't get Chase to pay up (yeah right), they'd debit the money from my account without notice.

[Deleted]

I can see how they might be leary about just cashing a check. You can make them out for whatever amount you want right? How would they know if you didn't exceed your credit limit?

[azphx1972]

"forgot to mention that I asked to just cash the check."

This may be where the issue lies. Most banks have hold policies on deposits from other financial institutions, and will not give you immediate access to the funds (unless it's a certified cashier's check). I suspect that had you just deposited the check, and then tried to access it after the hold has been lifted, there wouldn't have been a problem.

[mithrin]

Apr 22, 2011 13:10:29 GMT -5 marmar said:

Oh, forgot to mention that I asked to just cash the check. I was told they'd give me the $$$, but that if Wells couldn't get Chase to pay up (yeah right), they'd debit the money from my account without notice.

Wow, you left out a HUGE part of the story. I can totally understand a bank not wanting to hand you cash in exchange for a check drawn on another institution, ESPECIALLY a CC check which they can't quickly verify with Chase that the funds are available (as they can with a check drawn against a checking account).

They told you they'd take the money back if the check wasn't good...NO DUH. That's standard for any bounced check. WF may have had some problems with people writing out these CC checks for more than their limit (or printing up fake ones) and walking off with the cash.

Your original post said that they hassled you about depositing the check, which is much different than cashing it. It's routine to place holds on money from checks. 30-60 days sounds excessive, but I've found that most of the time, my bank clears the holds from check deposits earlier than the stated time frames. In your situation, I would probably have just deposited the check and waited out the hold, which probably would have been less than 60 days unless Chase really didn't have their act together. If you really need the cash right away, then going to a Chase branch is probably your best bet (or just paying the bill with the CC check, instead of acting as the middle-man).

[2kids10horses]

marmar,

I'm amazed they said they would even cash the check! The only reason they would is if you already had the funds in your account.

[marmar]

I only wanted to deposit the check. That's what they hassled me about. When I couldn't get anywhere with them, I asked, out of curiosity really, "Well, what if I just want to cash the check?"

One way or another, with a couple thousand in each of two accounts, there was no reason whatsoever not to deposit the check. I have enough to cover the amount more than 5 times over. The teller even told the branch manager, "Hey, she has way more than enough..."

[marmar]

Another branch cashed the check for me. Teller admitted it's a hassle for them, but so long as I have enough in my accounts to cover the cost of the check, there's no problem.

*edit: check was deposited, not cashed.

[jitterbug]

The reason I hate convenience checks is because they prey on the naive. My 80 year old mother, who lives on less than $1000/month Social Security, starting using them to pay bills without understanding how they worked. It was bad enough that she used them to begin with - but instead of writing just one check for $300, one month she wrote 8 checks (1 each to the telephone company, utility company, etc.), with a service charge of $5 each. And then paid on them for YEARS! Which is EXACTLY what the credit card companies want!

[marmar]

That's awful, jitterbug. As a general rule, I hate these checks and would rather not get them. But the "2 years, 0% interest" came in handy when I had to replace the fascia boards on the house and add gutters.

[jitterbug]

toughtimes, that is NOT my mom. She is just a sweet but naive little old lady who had every intention of paying off her credit card someday - and never comprehended that she would never be able to do that on her social security income. My sister and I didn't know about any of this until she started having creditors calling her several times a week. We ended up taking out a home equity loan on her condo in our names and took turns making the payment until she sold the condo and moved into senior citizen housing.

However, if she had died before the credit card was paid off, I would have happily let the credit card company eat that debt, since they made a poor business decision in giving a woman a credit limit of $10,000 on a $1,000/month income and encouraged her to charge on it. And they made their money back on the 29% interest that they collected every month!