Less Paperwork

Investors who had a credit line large enough to write a $20,000 balance-transfer check for zero percent to cash and invested the proceeds in the average long-term U.S. government- bond mutual fund over the last three months could have earned more than $4,000, after accounting for up-front transfer fees of 4 percent, according to average bond-fund returns from Morningstar Inc. (MORN)
The balance-transfer rates are competitive with a home- equity line of credit and require less paperwork, said McBride of Bankrate.com, a unit of Bankrate Inc. The average rate on a $30,000 home-equity line of credit was 5.42 percent as of Oct. 5, according to Bankrate.

“The ease of use is really the key selling point,” McBride said. Banks are likely only making the offers to customers with top credit scores, he said.