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The Eternal Rome Question (cash for apartments): Visa cash advance theory

The Eternal Rome Question (cash for apartments): Visa cash advance theory

Dec 14th, 2009, 11:52 AM
  #1  
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The Eternal Rome Question (cash for apartments): Visa cash advance theory

Fortunately, my particular cash advance problem just worked itself out, but I'm curious about something. In the course of investigating how to obtain large amounts of Euros upon arrival in Rome, I ran across this suggestion: load up your Visa account so you have a negative balance, get a Visa cash advance at a bank in Rome that displays the Visa insignia, and -- Voila! -- no interest and no concerns about ATM limits. I understand that the bank in Rome may charge a cash advance fee (my credit union, through which I get my Visa card, doesn't).

I asked about this at my credit union, and the person helping me didn't see any immediate problems with it. Are there problems? Would it destroy one's credit rating? Are banks reluctant to do this? Is the exchange rate worse for cash advances? Are the fees insane? It seems like something ought to be wrong --??

I won't be testing this out on this trip, but it would be good to know for future trips (knock on wood -- that future trips are in the offing, that is.)
jeanm is offline  
Dec 14th, 2009, 11:59 AM
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The problem that I think you'll run into is that many banks/ATM's still have either a per transaction limit or a per day limit.

I've run into this before with my ATM card. While I've had my credit union remove any restrictions on the amount that can be withdrawn per day/per transaction, the bank owning the ATM may have their own limit. For example, in Norway recently, there was no way that I could get out more than 2000 NKR (about $300) in a single transaction (or by doing another transaction at the same machine)... though I did have some luck getting money from a different machine later in the day.

If it works, there shouldn't be a credit score issue. I've also read that some banks don't handle credit balances well and still try to charge the cash advance fee.
astein12 is offline  
Dec 14th, 2009, 12:01 PM
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Most credit cards will not let you store "extra" cash there - you just can't pay more than the bill. (You need to check with your card issuer to see if they allow it.)

If by "Visa" you mean an ATM card with a Visa logo on it - well that's linked to your checking account and that's what people do to have spending money as they travel.

The problem is that most apartments won;t take crdit cards and banks do usually have a daily limit for withdrawals. You can ask to have this raised (mine is $1000 per day) or have cards for more than one checking account.
nytraveler is offline  
Dec 14th, 2009, 12:11 PM
  #4  
 
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I'm not sure this would work. Even if you pre-load your Visa credit card, I'm not sure that Visa will not charge you an interest fee (much higher than for purchases) as soon as you withdraw the money since by signing Visa's credit card agreement you have agreed to do so. Visa might say it was holding the money in case you made purchases during the time period or that leftover money goes toward purchases, not cash advances. For a credit card company, purchases and cash advances are two different types of transactions. Read your credit card fine print carefully.
ellenem is offline  
Dec 14th, 2009, 12:23 PM
  #5  
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NYtraveler - no, I mean a Visa credit card with cash advance feature. I can transfer as much from my linked bank account to my Visa account as I want to. My wonderful credit union, which is good and helpful in every way, can't lift the per-day cash limit because of its insurance. That's part of what precipitated this research project.

ellenem makes a good point. But even if the pre-loading didn't work, one could pay off the bill within hours over the internet (at least for my account). That was part of the theory.

astein12, I had indeed wondered whether we'd have to traipse in and out of banks hoping to find a place that would provide a larger sum. I guess that there's no perfect technique -- except possibly travelling in Europe for long enough to accumulate Euros before renting an apartment in Italy!
jeanm is offline  
Dec 14th, 2009, 02:00 PM
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The easiest thing is to have two ATM cards from two different accounts. The main one I use has a $1,000 per day limit, but if I need more than that for an apartment, I just get the rest from my second account. In Italy, I've never had a problem getting as much as I want from one machine, even though the machine has a limit. I have always been able to just do a second or even third withdrawal from the same machine to get the total needed.
SusanP is offline  
Dec 14th, 2009, 02:22 PM
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jean, I did exactly this... 20+ years ago! When I was a college student in France for a semester, I didn't want to carry lots of money in traveler's checks. I had a credit card from a local bank that was very generous with regards to fees (ie. virtually none). When I spoke with my parents, they would go to the bank and transfer money from my account to my Visa. I would then take a cash advance in about the same amount. I'm not sure I even paid a fee, but I'm sure someone will tell me how it wasn't an advantageous exchange rate, etc. etc. All I know is that it worked for us at the time and was much less risky than carrying lots of cash or traveler's checks.
surfmom is offline  
Dec 14th, 2009, 03:16 PM
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I do that all the time with my Visa. Load the account with whatever amount I need, and get free cash withdrawals at ATMs worldwide. Also from abroad I can "top up" my CC account since I only do online banking anyway. Visa even pays some 2% interest to me for all the extra money I got in the account.
As OP said, there is also the option to use a regular bank for cash advance. I forgot the limit but it was significantly higher than at ATMs. In some countries, like Germany, the limit for CC cash withdrawals at ATMs is much lower than for debit cards (no matter if domestic or foreign).
But it will all depend on how your local bank or CC company handles these options, and how the banks overseas handle it. Guess one has to inquire both carefully to be sure that it will work out.
Cowboy1968 is offline  
Dec 14th, 2009, 07:27 PM
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So -- surfmom and Cowboy1968 indicate that it can be done. Very interesting. It sounds worthwhile to try a small cash withdrawal on this trip, just to see how it goes.

SusanP is, of course, right about the two ATM cards. There is a tedious story about why I didn't do that, but the basic idea makes sense.
jeanm is offline  
Dec 14th, 2009, 08:42 PM
  #10  
 
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JeanM, it's worth noting that Cowboy1968 is in Germany, and if you have a US-based credit card, the situation might be different for you.

For what it's worth (not much, but just for the sake of completeness), I have Canadian credit cards, and I overpay my balances all the time. Nothing bad happens, except I have less to pay the next month. I looked into cash advances, and I think I determined that nonetheless I would have to pay interest for that 1-month period (which is a relatively slight amount in my case if you consider the amortized annual rate).
WillTravel is offline  
Dec 14th, 2009, 08:45 PM
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I think you need to read the terms and conditions. Sometimes there is a set fee for cash advances... regardless of whether there is a credit balance or not. When I did it, it was a local bank that had a credit card as a service to customers. I think credit cards in general are different. Although you mentioned a credit union... they generally have better terms and conditions -

good luck! let us know how the trial works!
surfmom is offline  

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