Been slack. Left it too late to BT?

mad_rich

Hi folks

Hope someone can help out with a suggestion.

I've been stoozing successfully for a couple of years. Stooze pot of £7k currently in Egg's Anniversary offer. This runs out on 1st November and I've only just (today) applied for a new card (Lloyds TSB Platinum).

I think I may have been a bit slack and left it too late to get accepted and do the BT. Does anyone have any suggestions as to the best option (assuming I get accepted by Lloyds TSB but not quite in time to transfer from Egg before the deadline)?

A - Leave the 7k in Egg at 13.9% - it will probably only be there for a few days.

B - Transfer the balance to an unused Morgan Stanley account (3.9% till 31 Nov) which will cost a £35 BT fee

C - Pay off the Egg balance from my savings and begin again :mad:

D - Apply for another card now (Barclaycard or Amazon) and do the BT to whichever card arrives first

E - Something else?

Thanks in advance.

YorkshireBoy

mad_rich wrote:

A - Leave the 7k in Egg at 13.9% - it will probably only be there for a few days.

B - Transfer the balance to an unused Morgan Stanley account (3.9% till 31 Nov) which will cost a £35 BT fee

C - Pay off the Egg balance from my savings and begin again :mad:

D - Apply for another card now (Barclaycard or Amazon) and do the BT to whichever card arrives first

E - Something else?

Thanks in advance.

A - Egg is 15.9% isn't it? At 1.240% per month, your £7K will incur interest of £87 per month - or £2.90 per day. Meanwhile your stooze pot interest is generating £0.71 per day (a net loss of £2.19 per day, or £66 for the month of November).

B - This might be a wise move, bearing in mind the Egg interest as shown in A above.

C - Could do, but if LTSB can see you have a zero balance (from your CRA report) why would they let you BT from Egg? It is possible though, that if you can leave the Egg repayment from the stooze pot until the "last minute", that LTSB will still see the balance.

D - I don't think you've got time. Anyway, Barclaycard have a £5K BT limit. I'd probably wait for the outcome of the LTSB application (and possible appeal) first.

E - Buy a diary so you can record the end date of the LTSB introductory offer.

Does this help?

mad_rich

Thanks for your help. Looking at the figures, it's not a terrible scenario.

At a cost of £2.19 per day, I could miss the deadline by 10 days and it would only take me a month of stoozing to make the money back. I can live with that.

As it happens, I've just had an email through confirming that I've been accepted for Lloyds TSB (although it doesn't state my credit limit). Now it's just a question of how long it takes to get the paperwork and whether the BT goes through in time.

I think I'll go for option E next time!

Cheers,

Rich.

P.S. How did you calculate that monthly interest rate from the APR?

YorkshireBoy

mad_rich wrote:

Now it's just a question of how long it takes to get the paperwork and whether the BT goes through in time.

I've just responded to another poster, suggesting that they ring LTSB, ask what the limit is, and get the BT set up so that as soon as the card is activated, the BT is actioned.

mad_rich wrote:

I think I'll go for option E next time!

That would be a wise move!

mad_rich wrote:

P.S. How did you calculate that monthly interest rate from the APR?

Online summary boxes are your friend!

Former_MSE_Dan

P.S. How did you calculate that monthly interest rate from the APR?

If you can't find a summary box or arent at your PC, then all you have to do is take the interest rate and put it into the form 1.xxx e.g 15.9% becomes 1.159.

Then take this to the power of (1/12)

i.e. to work out 15.9% in monthly interest, you'd do

1.159^(1/12) = 1.0124.

you then extract the monthly interest by taking the numbers after the decimal point, and putting a . after the 2nd number

= 1.24% monthly

mad_rich

So my 3.9% rate at Morgan Stanley translates to 0.32% per month.

Or roughly 75p per day on a balance of £7000.

Right?

sly_dog_jonah

YorkshireBoy wrote:

C - Could do, but if LTSB can see you have a zero balance (from your CRA report) why would they let you BT from Egg? It is possible though, that if you can leave the Egg repayment from the stooze pot until the "last minute", that LTSB will still see the balance.

I've never heard of a Credit Card company doing a credit search to find out if you have a genuine balance on a card before you BT across from it. Even so, it takes up to a month for egg to update the CRAs with the account status.

The safe bet is simply to pay it off in full from savings using a debit card on the last day of the 0% anniversary, so that you don't accrue interest. Then BT the Lloyds limit (minus any fees or % restrictions) to egg and then take the positive balance on your egg and SBT it back to your current and then savings account. Saves interest, hassle and unnecessary credit searches. Only downside to this method would be if you had to take the savings out of an ISA, which would not necessarily allow re-investment in this tax year (depending on how much you've deposited/invested already). Also as the advantage that you can wait until the last minute to know if the Lloyds BT will go through in time.

YorkshireBoy

sly_dog_jonah wrote:

I've never heard of a Credit Card company doing a credit search to find out if you have a genuine balance on a card before you BT across from it. Even so, it takes up to a month for egg to update the CRAs with the account status.

Sorry, I should have made the point clearer in my original reply. I was referring to any subsequent appeal, not the initial application as this is largely scored by computer.

Maybe I'm looking on the black side, but when I appealed a rejection earlier this year this is exactly what happened to me.

Whilst I was undergoing the telephone interview, the manual underwriter was looking at my credit report. She could see exactly what my Egg balance was on her screen.

mad_rich

Well, looks like I didn't have enough faith in the system!

BT went through today, with 3 days to spare (one working day to spare, come to think of it!). Nothing like cutting it fine...