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  • FIRST POST
    • KrisKitten
    • By KrisKitten 17th Mar 17, 10:27 AM
    • 5Posts
    • 0Thanks
    KrisKitten
    Credit Card advice for a total simpleton!
    • #1
    • 17th Mar 17, 10:27 AM
    Credit Card advice for a total simpleton! 17th Mar 17 at 10:27 AM
    Hi,

    I need some real-life advice as I am financially-dense and don't want to make a huge mistake signing up to something!

    I have an overdraft of just under £3K which I would like (or have been advised) to put on a 0% credit card to pay off without overdraft fees and to reduce the risk of the bank pulling the overdraft and demanding repayment.

    I honestly really struggle to understand how credit cards work, what all the various %'s mean in the description and therefore whether I am making a good one. I'm not totally fussed on paying all of the total back during this cards lifetime, as I would be happy to transfer to a new card at the end of the 0% period. Obviously it would be nice to clear it we will see.

    I have found this card, for which I am pre-approved, but I just need someone with some sense to explain whether it is a good idea or not? I'm aware that being pre-approved, given my credit score isn't the best, there must be catches.

    32 months 0%
    1.99% fee
    19.9% REP APR
    - You must do your balance transferwithin 60 days to get the 0% deal. Transfers after that will have 19.9% APR and a 5% fee.
    - 0% balance transfers for 32 months, also with 1.99% fee
    - If you do a balance transfer, you'll pay interest of 19.9% a year on any remaining balance
    - Minimum payments of the greater of 1% of balance plus interest or £25


    Please can someone break this down into laymans terms for me??

    1. In basic, simple person terms, what is expected of me here? Am I right in thinking it's; take out the card, transfer £3K into my current account (thereby wiping my OD), pay an initial fee, each month transfer the minimum payment (ideally under £100) from my current account to the credit card, at the end of 0% period start again with new card?
    2. It would not be the intended purpose, but if neccesary could I use this card for general or emergency purchases or payments to individuals accounts?
    3. How is there a 0% on balance transfers, but also a 19.9% interest rate if you do a balance transfer?
    4. What would my costs/Minimum payments be on an initial transfer of £3K?
    5. So long as I am proactive in ensuring I pay off the full amount or transfer to a new card before the 32 months are up, what are the risks of me getting into hot water?


    Sorry for the long list of questions and for being so dense! Thanks in advance for any help!!
Page 1
    • Placitasgirl
    • By Placitasgirl 17th Mar 17, 10:37 AM
    • 179 Posts
    • 302 Thanks
    Placitasgirl
    • #2
    • 17th Mar 17, 10:37 AM
    • #2
    • 17th Mar 17, 10:37 AM
    It isn't a balance transfer you need; it's a money transfer.

    Balance transfers are used to transfer an existing credit card balance to a different or new credit card.

    Money transfers on a credit card are made to an account of your choosing, so in your case to your bank current account to clear your overdraft. Money transfers, once in your bank account can then be used as needed and are also sometimes used to clear store-cards, loans etc.

    You can't make a balance transfer to a bank account.

    Take a look at your eligibility for a card which offers money transfers and pop back to update us and we can then explain the terms of the offer/s for you if necessary.
    • Money Rollercoaster
    • By Money Rollercoaster 17th Mar 17, 10:43 AM
    • 246 Posts
    • 595 Thanks
    Money Rollercoaster
    • #3
    • 17th Mar 17, 10:43 AM
    • #3
    • 17th Mar 17, 10:43 AM
    Here's a link ...


    http://www.moneysavingexpert.com/loans/cut-loan-overdraft-costs


    There's an eligibility calculator too.


    An important point is that if you get a money transfer card and you use it to spend on, you will pay the high APR interest on your purchases from the day you purchase to the day that portion of your balance is paid off. General advice is by all means get a money transfer card to sort out a loan, but find another way of handling your purchases. One option is that you might have other money transfer offers appear on the same card (quite often not as good as your sign up offer) and you could then transfer the money out to your bank to pay for purchases / bills / whatever.
    Living Life @ 174 BPM >> CC Balance (0%) -£3,565.99 - Target DFD Dec 2017 >> Loan (Car) (3.1%) -£19,803.74 - Target DFD Nov 2020
    • Superscrooge
    • By Superscrooge 17th Mar 17, 8:45 PM
    • 824 Posts
    • 577 Thanks
    Superscrooge
    • #4
    • 17th Mar 17, 8:45 PM
    • #4
    • 17th Mar 17, 8:45 PM
    A few points.

    Being pre-approved doesn't guarantee you will be accepted for the credit card.

    You may be awarded a lower credit limit than £3000

    Don't spend on the card unless there is also a 0% purchases deal

    if you do get accepted. Don't assume you will automatically be able to balance transfer to another 0% card in 32 months time. There are lots of posts from debtors frantic because they had automatically assumed they would be accepted for further balance transfers and didn't have a 'Plan B'
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