Help clearing credit card debt please

dragonfly02

First ov all hubby applied for the plus card and was declined, He also applied for virgin and was declined both requests were for £3500 bt

He was then contacted by halifax and pre-approved for the 0% 9 month interest card, we have the paperwork here waiting to be signed and returned but I wanted to double check that this is the best thing to do as I would have hated it if we made a bad decision without getting advice and ended up in 9 months time either owing the same amount or more

ILW

dragonfly02 wrote: »

First ov all hubby applied for the plus card and was declined, He also applied for virgin and was declined both requests were for £3500 bt

He was then contacted by halifax and pre-approved for the 0% 9 month interest card, we have the paperwork here waiting to be signed and returned but I wanted to double check that this is the best thing to do as I would have hated it if we made a bad decision without getting advice and ended up in 9 months time either owing the same amount or more

A lot of these pre approved offers are no such thing. When you look a little closer it tends to say something like "pre approved to apply".

dragonfly02

The exact paperwork reads

Dear Mr Dragonfly

following our recent telephone conversation, You'll be delighted to know that your application has been approved for the HALIFAX CREDIT CARD with an estimated credit limit of £2600*.

The other thing is that this card states- 0% for 9 months on balance transfers made within the first 90 days**(3% balance transfer fee applies)

dragonfly02

Ok so having looked at our monthly repayments for each scenario we cannot see the benefit, We believe we can stretch to £200 per month payment

Current card £3500 18.9%apr, paying £200 per month would be paid off in around 21 months

New halifax card £2600 0% for 9 months would be paid off in about 20 months if we transfered what's left from the original card when enough credit is paid off

Obviously the amount of saving in interest is £400 but the repayment time would work out almost the same.

CannyJock

dragonfly02 wrote: »

Ok so having looked at our monthly repayments for each scenario we cannot see the benefit, We believe we can stretch to £200 per month payment

Current card £3500 18.9%apr, paying £200 per month would be paid off in around 21 months

New halifax card £2600 0% for 9 months would be paid off in about 20 months if we transfered what's left from the original card when enough credit is paid off

Obviously the amount of saving in interest is £400 but the repayment time would work out almost the same.

You pay less, it's as simple as that.

If you leave it as is, you'll pay £568.16 in interest @ 18.9% APR:


Assuming you move £2470 to the Halifax card (95% of your estimated limit - it could be more but you won't know until you apply) make the minimum payments to your Halifax card while paying the rest of the money to your current card, you'll pay it £93.88 in interest:



And assuming the Halifax card changes to their standard 16.9% APR and you switch the full £200 to it from February onwards, you'll pay £211.69 in interest:



So I make that £305.57 interest versus £568.16 - so you'll save £262.59 just by taking Halifax up on the offer their throwing at you No brainer in my book

never-in-doubt

cannyjock - you are the man!