Advice appreciated-I'm determined to be debt free!

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  • Sorry Spendless didn't see your post. I took out the card about a year ago so I will double check what you have said and find out if I am going to get a charge for having the card.

    Thanks for that :D

    HP
  • And get this, last night I came home to a letter from RBS informing me that my credit limit has been raised to £5800!!!  They make it so easy to get into more debt...

    You've convinced them you can handle a certain amount of debt responsibly, so obviously they now want you to take on more debt, since you’re a nice safe person to lend money to.
    Just a query - is it worth asking BCard if they would like to increase my limit to take advantage of the 0% or would that constitute a further credit check?

    Difficult to say - usually, it does mean a credit check. RBS think you're OK to lend to, though, so there must be at least a chance that Barclaycard will think so too, credit status notwithstanding.

    This may be an opportune point to introduce you to what Martin calls the Credit Card Shuffle: the elegant practice of luring your existing card lenders into a Dutch auction to keep your balance on their card.

    In your case, it might work like this. You ring RBS and say thanks a lot for the higher limit but you've just bought a house, you need to buy some stuff, and what you'd really like is a better interest rate because otherwise you won't be using this higher limit…so how about it?

    They will probably say "get stuffed", but don’t be fazed if they do. Using your increased RBS credit limit, transfer your First Direct balance to RBS anyway. If what Spendless says is true, i.e. there's a £20 annual fee, then the effective annual cost of the FD debt is much the same as RBS, despite the lower headline interest rate.

    You've now cleared your FD balance at no extra cost to you. This is useful, because it means you can now pressurise FD. The only leverage you have with a card lender is taking your business away from them. If you maintain the account in good standing, the card lenders absolutely do not want this to happen. They want to keep you as a reliable borrower.

    So now, you ring up FD and point out you've cleared your balance because the interest rate was so high, so would they please close your account. With any luck, FD will offer you a better interest rate to stay with them. It won't be 0%, but as long as the rate offered is lower than what RBS is charging you, you transfer debt straight back to First Direct from RBS.

    You then phone RBS up again. Tell them First Direct have just underbid RBS on the interest rate. Ask them if they'd like to improve on this rate, or would they rather you transferred even more of your balance to First Direct?

    Just to focus their minds, transfer whatever you can to the Barclaycard anyway. If RBS see £2,000 of your balance vanishing to other lenders, there is at least some chance that they'll do something to keep your business.

    And so it goes on. Once your Barclaycard 0% deal expires, they can join in the Dutch auction too.

    A poster called Rochdale_Guy did this last year to such good effect that he blagged his interest rate down to about 5%. All he did was move money from account to existing account, then ring up and threaten to close them. At this point, the lenders were miraculously able to improve the rate he paid.

    You do actually have to clear -- or at least substantially reduce -- card balances to be taken seriously. If you don’t do this the lenders will call your bluff. But if you do, and they can see you are 10 seconds away from closing the account, they become a lot more accommodating.

    For what it costs - 3 or 4 phone calls - it's definitely worth a try.
  • Spendless
    Spendless Posts: 24,110
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    Harriet Potter- I'm just looking at my FD CC Statements and Septembers says
    "To Use your card for free you need to spend £1200 a year"

    BUT it doesn't say it on November or Decembers Statement (Octobers is missing!)

    So i'm now not sure if it's changed or not. In September we had already spent more than £1200 on it so it's not because we were under this amount.

    If anyone knows will they post or i'll ask FD next time i ring and post the reply :)
  • Spendless
    Spendless Posts: 24,110
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    Ha - Found my own answer ;D

    Turning over Decembers statement and reading the small print on the back ::). It says under
    Charges

    Annual Fee- An annual Low Usuage fee of £20 per annum will be payable if purchases (not including refunds,interest,cash advances,foreign currency and travellers cheques) totalling £1200 have not been debited to the account during the previous year.

    So it looks like they've stopped warning people of this on the front of the statement >:(

    HTH

    Best wishes :)
  • Many thanks for checking that Spendless - I will do as WP suggests above and get rid of the FD first as he says it will cost the same with the charge as the RBS is costing - then I can crack on with the RBS one.

    Meanwhile I'm going to be brave and make a few phone calls and see if I can do a bit of shuffling like suggested as well. I'll get there in the end!! :)

    Many thanks

    HP
  • Big_Nige
    Big_Nige Posts: 144
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    Spendless wrote:
    Ha - Found my own answer ;D

    Turning over Decembers statement and reading the small print on the back ::). It says under
    Charges

    Annual Fee- An annual Low Usuage fee of £20 per annum will be payable if purchases (not including refunds,interest,cash advances,foreign currency and travellers cheques) totalling £1200 have not been debited to the account during the previous year.

    So it looks like they've stopped warning people of this on the front of the statement >:(

    HTH

    Best wishes :)

    Many thanks Spendless, I have a six month balance transfer on F.D. Opened the account July 04 but didn't transfer till Jan 05.... So in effect it will only be a 5 month B.T. Shucks
    Every day above ground is a good day.
  • Reaper
    Reaper Posts: 7,277
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    Spendless wrote:
    Can I just add something into the equation about the FD CC.

    I have one and unless you spend £1200 p.a on it you are charged £20 for having it.
    Can I just take that back out of the equation!

    First Direct used to charge £20 on the Gold card wheras the ordinary black one was free, but now they have changed the T&C so that none of them have an annual fee. Have a look at the summary boxes on their credit card pages for confirmation.

    EDIT: Thinking about it while that applies to newer cards it is possible that they have not changed the T&C for existing card holders. Guess you've got to phone them for an individual answer for your card.
  • Spendless
    Spendless Posts: 24,110
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    Reaper - where does it say on that link that they do not charge an annual fee? I can't find anything about it.

    They most definately do say on the back of my last statement that they do charge (as per my last post on here).

    Mine is the Gold card.
  • Spendless
    Spendless Posts: 24,110
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    Ignore my last post i found it.

    Will be phoning them in the morning

    Thanks
  • Spendless
    Spendless Posts: 24,110
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    To update about the annual charge on the FD visa card. I have just rang them and they have said they are removing the annual fee from the card.

    So as Reaper says there is no annual fee for new holders but exisiting ones need to check.

    What FD have just said to me is if i do get charged to ring them back an they will look at removing the charge.
    I am over the minimum spend anyway on my card but for the posters that aren't i'd suggest ringing FD.
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