Lloyds TSB Mastercard help

poppy123b

Hi there
im looking for a bit of advice regarding my Lloyds TSB Classic Mastercard, i currently owe on it £1,221.76

i pay back more that the minimum payments required of £35.00 a month which is the most i can afford.
However due to the interest on the card, they are taking roughly £19.00 of that a month in interest, which seems like an awful lot.

I would like to be able to find a better credit card which has lower interest rates, so that i can perhaps do a balance transfer and pay the debt off but the whole thing to do with interest rates etc really does confuse me, which is why i probably have not done anything about this until now. And why i am now turning to all of you for a bit of advice on this matter.

just so you know I wont be spending on this card at all, infact the mastercard was cut up and thrown away a few years ago to prevent this from happening lol

Any help would be much appreciated

dylanuk

Hi,

You should look into getting a 0% balance transfer credit card. There are cards available offering up to 16 months now, though most are 12+ months (http://www.credit-card-comparison-online.co.uk/0-balance-transfer/default.asp).

The Virgin credit card is probably a good bet, that offers 0% for 15 months (http://www.credit-card-comparison-online.co.uk/virgin/money.asp).

When you transfer to a 0% card, you get 0% interest for the time stated, e.g. 15 months. You will have to pay a transfer fee, usually 3% (it's 2.98% on the Virgin credit card) - this is added to your credit card balance so you don't have to pay it upfront.

For £1,221 you'd be looking at a fee around £36.63 (this is a one-off fee for transferring the money to the new credit card at 0%) - which would be an immense saving compared to paying £19 in interest every month.

Keep up at least the minimum repayment to keep your 0% rate, it would be 3% on the Virgin credit card - so around £36 a month (no real difference to what you're paying now).

If you wanted to clear the balance within the 15 months you'd have to pay back around £82 a month.

However, even if you only paid back the minimum, £36 - you'd still halve your owed balance by the end of the 0% period to £681 (based on it being 15 months). Then you could always transfer to another 0% offer if you wanted (the transfer fee then would only be around £20 - based on £681 balance).

Just remember - don't spend or withdraw cash on the card you balance transfer to, as this will incur interest and you're payments will always pay off 0% balances (your balance transfer) first.

Hope this helps!

poppy123b

Thats great help, thankyou very much for setting me on the right path. And for explaining it so well for me to understand.
will definatley give that Virgin credit card a go :T

dylanuk

Glad to help

c3vrg

yes think i mentioned this before, if you have a large overdraft facility that is one solution if not then a balance transfer to a new card is a good idea, depending on your credit score they may not give you the full amount but theres only one way to find out and dont use the card till you pay of the balance and dont forget to switch to another card before the 15 months run out

:money: :money: :j