Borrowing £11k at 0.9% APR until 10/9/2006

Rochdale_Guy

Oh dear, too little too late I guess for me ....!

Having cleared my credit account balance with xXxX, I noticed they were offering to let me borrow upto 95% of my balance at 0.9% APR until 1st Sept.2006 to either pay off other debts or pay it into my bank account. Not bad...!

Anyway, I just got off the phone with them and asked if they could do a better rate - if I borrowed over £10k - with them to pay into my bank account.

After much haggling, they offered me over £11k at 0.9% APR until 10th September 2006, with a £50 transfer fee

Point now is, how best to maximise the interest on this borrowed £11k !!!???

I have an ING savings account getting 4.5% interest (before tax), so any other suggestions ?

Oh yeah, more importantly, what the heck do I pay back each month exactly so as not to get in over my head!?!?

I think the minimum repayment they want is 3% of the balance, but they already take out the min. repayment each month by D/Debit anyway. They still do even with a zero balance, hence me being £5 in credit since clearing my account balance!!!!

Any moneysaving tips please?
Rochdale_Guy

Who should've asked for advice before borrowing this £11k !

YorkshireBoy

I'm assuming this is a Virgin card? I'm also assuming you've just had a credit limit increase?

It may be too much of a gamble for you, but if you call to close the card there is a good chance you will be offered 0% for 6 months - and if you 'hit the jackpot' they may also waive the fee.

If you don't want to gamble, then just take the £11K and put it with ING (on a 6 month 0.9% deal with a £50 BT fee it might not be worth hanging onto it too long in your current account while you open a higher interest account).

Pay them the £5+interest/month minimum payment by DD for 5 months and clear the balance by 10/9/06. Easy!;)

BTW, if it is Virgin, why the £50 BT fee anyway? - your original T&C's were £35 weren't they?

Rochdale_Guy

Thanks, it wasn't a Virgin card - it's an MBNA card !

I'd prefer to just stick it in my ING a/c and see how much interest I'd get.

YorkshireBoy

Rochdale_Guy wrote:

I'd prefer to just stick it in my ING a/c and see how much interest I'd get.

According to http://www.whatsthecost.com/stoozing.aspx, you'll make £96, but this is only an approximation because you'll pay the £50 BT fee with your first DD.

Rochdale_Guy

YorkshireBoy wrote:

According to http://www.whatsthecost.com/stoozing.aspx, you'll make £96, but this is only an approximation because you'll pay the £50 BT fee with your first DD.

Only £96 ? Whats the point in that then

YorkshireBoy

Rochdale_Guy wrote:

Only £96 ?

'Whatsthecost' says...

Total interest earnt in 5 months: £162.80 (That's £208.72 gross).

However, you also had to pay a £50.00 balance transfer fee, which you should deduct from your profits.

Total interest paid in 5 months: £41.71.

After paying a total of £25.00 in minimum payments, you'll need to clear the balance of £11,066.71

This will leave you with £96.09 in your savings account.

Edited to say: The above is worked out on 5 months 'effective' stooz, which allows for a 7-10 day BT going in and a small margin allowed for paying off at the end of the stooz. If you get a speedy SBT and equally quick BACS transfer, and are prepared to sail 'close to the wind' when paying off the card, you could make more!

bolo

it takes 5 working days to set up (at least thats what they told me.) you can always ring up to cancel the BT if you get lucky then it shouldn't cost you anything.

sprouty76

If you haven't used your Mini Cash ISA allowance for this year, you could get about 5% tax-free on £3000, plus 5% on another £3000 after April 6th.

Most people wouldn't suggest using your ISA allowances in this way, but if they were going to be unused anyway you may as well use them for something.

CTT_2

Rochdale_Guy wrote:

Only £96 ? Whats the point in that then

As you consider £96.00 a small amount why not give it to a charity who Im sure could make good use of it.