Paying Off An Overdraft With A Credit Card?

Vanessah82

Hello,

I'm new to this site and just wanted some advice.
I have a student overdraft (still!) which I cannot seem to shift. At the moment it is £1,750. (Interest is £24 a month!)

I was going to get a loan to pay it off, however, at the moment I am temping and cannot commit to a fixed amount each month.

So, I just wondered if I could get a credit card (like a 16month 0%) and pay the overdraft off using that, then pay the credit card off over 16 months in installments which will suit me.

What are your thoughts?

Many thanks in advance for your help.

Vanessa x

dazza.mk

Its possible to transfer to an MBNA credit card or Egg credit card.

With the Virgin (MBNA) for example you could get 14 months 0% for a 2.98% fee (apparently soon going up), so you would have to pay the £51.15 BT fee on the first statement, then £125 per month in order to clear (assuming you wanted to clear the balance within the 0% period)

YorkshireBoy

The Virgin card is 16 months, and the BT fee is no longer collected with the first minimum payment...it's now added to the balance.

The minimum payments are £25 per month throughout the 0% period (roughly the same as your O/D debit interest).

The big danger here is if you only pay £25 per month (and the temptation currently must be huge so watch out for that) you'll still be left with a very large balance after 16 months (£1,400) and MBNA have a very nasty habit of increasing the rate - post intro period - to anything up to 34.9% APR...which is 2-3 times your current O/D rate.

Be careful...and disciplined!

dazza.mk

Thanks Yorkshire Boy, should have been aware of that as I'd just applied for it, and was confusing interest free with the TEsco offer.

As Yorkshire Boy says re: hiking rates, although this shouldn't be an issue IF you can keep the agreed overdraft limit, then at the end of the 0% period if all else fails you can pay off to your current account and be left with an oerdrawn balance somewhat improved from today.

Vanessah82

Thanks guys....think I understand what you mean! xx:beer:

Vanessah82

I am having trouble getting another credit card due to the fact that I am temping at the moment....any suggestions?

xx