What to do, all advise welcome.

Penny2myName

Ok, Got a letter from Helifax about my overdraft review. They are increasing it to £700 as of the 12th December. I was after just having O/D removed around Feb time, but am now thinking of using £500 of the O/D facility to pay towards my CC. My CC is with Vanquis so its exceptionally high interest. and I am sure my O/D interest is no where near as much.

This is info I have
Current Account variable interest charged on an arranged overdraft 1.50% per month (19.5% EAR*)
Credit Card Purchase interest 2.840% per month 34.080% per Year
Cash interest 3.433% per month 41.190% per year.

Would I be doing the best thing embracing my O/D with open arms so as to bring my CC total down by a good 3rd of what I owe on it.

laura2481

Hmmmm, that's a tough one. One one hand you would be paying less interest, on the other you would be splitting your debt in two places... I, personally, would be tempted to leave the CC debt where it is, and just throw all available money at it instead. But I can see the value of less interest...

Ok, I am no use what so ever!! I'm on the fence on this one. Hope someone else is a little more helpful!

Verbatim

I'd go for the option which costs less! So if the o/d interest IS lower and you'd need to check and make sure you're comparing like with like, APR or AER, then use the money to pay down your cc. Maybe also plan how you can pay off what you owe and the time it will take.

Penny2myName

Thanks for replying. Positive the O/D will be the lower options, think its my mindset of hating to see red figures on my bank account that has me differing. Already have my credit card cut up, so its just a case of minimising the total amount of interest which I am paying out a month.

paybacktime2008

Might be worth putting both figures in the snowball and see what it throws up.

GeorgeUK

I rhink it would be better using the overdraft, but make sure there are no charges and find out what the interest rate is. I take it you don't think you'll be able to get a new creditcard with possibly a 0% promotional offer?