Balance Transfer Question - does a negative balance affect BT offer?

debtfreesomeday

Hi

I currently have two credit cards - an egg card, which currently has a positive balance (ie. they currently owe me £5).

A virgin card which has a negative balance of £2600, reduced from nearly £7000 over the last year. I am currently paying off at least £350 a month on the virgin card to clear it asap, more when funds allow.

My problem is that the 0% on the virgin card runs out in August. I have been declined a couple of 0% cards lately so it seems my credit rating is shot. I am planning to transfer the virgin balance to egg, so I have phoned egg and they said there will be a balance transfer offer on the anniversary of my account opening in August, although this cannot be guaranteed.

Problem is, I ideally need to make a purchase of about £300 which I was intending to put on the egg card (which has a limit of £5500). My question is, will me having a negative balance of about £250 - £300 on the egg card damage my chances of getting a good balance transfer offer with egg in August? Will they only offer me a balance transfer if the card is cleared or in a positive balance?

Thanks in adavance!

CannyJock

Nope, balance of £ 250 won't affect 0% offer. They'll hope you take the offer, transfer a balance, so they can allocate your payments against the 0% balance allowing them to charge you interest on the £ 250.

Have you thought about reducing the limits on your existing cards to reduce the amount of available credit, increasing the chance of getting a new 0% card?

There's another trick where you could apply for an MBNA card, hoping to get a small credit limit and then move credit limit from your Virgin card to your new MBNA card, do a transfer direct to your current account, take the 4% fee and use that to repay the Virgin card.

When were your last unsuccessful applications?

Full list of 0% offers on http://www.stoozing.com/0fees.php

Problem you've got now is that even if you call them today to ask for a credit limit reduction, it can take up to 2 months for that to show on your credit report so wouldn't be visible until August anyway.

debtfreesomeday

Thanks for the advice CannyJock. Got turned down for a card last week though, so don't think there's much chance of me getting another, but I shall definitely act on reducing the credit limits as you suggested. Shall be cancelling the virgin card as soon as I can get the balance off of it.

CannyJock

Have you looked at your credit report to check no dormant cards on it? Will also help confirm history of payments or anything else adverse that could affect new applications.

Free 30 day trial with Experian, or pay the £2 for the printed versions. See the thread on obtaining credit reports for details.