Credit Card Balance Transfer Discussion Area 2

Reaper

1st time using a message board so bear with me.
How do you extract a balance from your new credit card (to put into a high interest account) when you don't have any balance to transfer to it. Do the credit card company just give you the total of your credit limit as a loan for 6 months?

Best to start by reading Martin's article, but briefly...

Option 1: Use a Super Balance Transfer card. Egg is the best example of this as they let you BT to your bank account to pay off your "overdraft". Then you can do what you like with the money. MBNA were another but some people are starting to get hit by charges. Make sure you do a Balance Transfer NOT a Cash Advance.

Option 2: You have credit card A and also credit card B. Both have nothing on them. Say you want to do a BT from A to B for £5000 (or whatever your credit limit is). They don't know you haven't got any debts on the other credit card so they pay the money in. You now have a credit card with a positive balance of £5000. Many issuers will allow you to take the extra off to your bank account without any charges. You can always say you paid it in error. Once again Egg is a good candidate to be used as a "gateway" card because it is so easy to move the money to your bank account and you can do it online without having to answer any awkward questions.

Hope that makes sense.

Edit: You can find Martin's SBT article here: http://www.moneysavingexpert.com/cgi-bin/viewnews.cgi?newsid1076883546,34894,

DanMan_3

Thanks for that Martin, but is there any way of doing the transfer to a current account from the application form? My understanding was that regular BT's are done via the application form, but SBT's can only be done once the card has been approved and issued.

MSE_Martin

You should be able to do it at application on the phone.
Sorry to be inexact on this, it's a question of trying to get an official policy where there doesn't seem to be one.

DanMan_3

That's OK, I'll just have to insist when I call to make the BT that they'll waive the fee. If they won't I'll just keep calling back until I find someone who will. At least let's take advantage of them not having an official policy!

Gotabiscuit

If it's any use, I did my SBT by using the form that was attached to the envelope used to return the credit agreement and wasn't charged a fee.

DanMan_3

That sounds like a plan . Thanks gotabiscuit

Greenstuff_2

Just a thought

When you apply for a credit card and put down how much you want transferred to another card they don't actually check how much is the outstanding balance is.
If you want a bigger credit limit just put down the amount you would like.
If you keep a card empty that does balance transfers into a current account, you could do a balance transfer to that card and then transfer the money off it.
Or use that card for normal spending putting the equivalent from your spends into your savings account or ISA.
It doesnt matter if you dont get the limit you put, they just transfer the limit they give you.
And before anyone says anything about fraud, they dont actually ask what the outstanding balance is, they ask what the amount is you wish to be transferred, so you are not telling fibs.

Galstonian

It is not the first time this particular thought has been posted.

A couple of points:

What you request as a balance transfer may bear no relation to your credit limit.

Individual lenders have different terms and conditions. Some explicitly state that transfers can be used for particular purposes, some do not. Either way it is difficult for them to see what you do with the money. It is impossible to say whether you are doing anything fraudulent without referring to the conditions of the specific agreement.

muppetyness

hi, ive just been accepted for an egg cc. The limit they set is £750. Is this standard? or do they offer each applicant different ammounts based on credit score? The reason i ask is, ive got a nationwide cc and the initial limit i was given by them was £1700. Could that be because i bank with them, or could my credit score have gone down in the last 6 months? ??? Would i be able to get the limit increased? The reason i got the egg card was to transfer the balance (now about £1300) off the nationwide card as the interest free period has run out, so £750 wouldnt be enough to stop me paying interest. Sorry, quite long and rambly... am new to this credit card shuffling business :-[ One more thing, i have a tesco cc and a barclaycard which now are clear, should i close them now or just give them to my dad to hide? (cant quite trust myself ::) )

thanks in advance for any help

mupps.

Reaper

You asked a lot of questions, I'll try and answer them.

do they offer each applicant different ammounts based on credit score?

Yes

Could that be because i bank with them, or could my credit score have gone down in the last 6 months?

Could be either but if you bank with them they know you much better than a new company having to rely on credit searches. As a general rule as long as you have behaved responsibly with your bank account expect to get a higher credit card limit than with a 3rd party. In my case my bank gave me 4 times the average of all my other cards.

Would i be able to get the limit increased?

Not if you have only just taken it out. After a few months of responsible use (ie paying off at least the minimum each month) they may well agree to increase it

The reason i got the egg card was to transfer the balance (now about £1300) off the nationwide card as the interest free period has run out, so £750 wouldnt be enough to stop me paying interest.

This is a situation you should be prepared for from the start, it is always possible to run out of companies willing to give you interest free periods. One possible answer would be to apply for another card with an interest free period. Hopefully the two combined might reach your target amount.

i have a tesco cc and a barclaycard which now are clear, should i close them now or just give them to my dad to hide? (cant quite trust myself  ::) )

If you don't plan to use them any more you should cancel them. Having too many credit cards will also start to reduce your chances of getting any more.