Credit Card to pay overdraft

Blakey1982

Hi all

this has probably been on here a few times but i'm thinking of applying for a new credit card to pay a £3000 overdraft on my current account. Hopefully then switching my current account to another bank.

IS this a good idea?? I havent had a credit card for about 3 years and my credit rating on Equifax and Experian is classed as Good.

hopefully looking for a long interest free card with low balance transfer for £3k

Any info would be appreciated

Thanks

Treadmill

Try the Virgin Credit Card, that would allow you to clear your overdraft by doing a money transfer to your current account, It will cost you 3% (£90) though, I'm not sure its a good idea as there is always the danger that you could go back into your overdraft again and just be in a position where you have more debt to service, it might be a better idea to start cutting back and use the savings to pay off your overdraft

Blakey1982

cheers tread

Halifax Current account charge about £35 a month at the moment but there charges are changing in Decemeber to:

£1 per day for arranged overdrafts up to £2500
£2 per day for arranged overdrafts over £2500
£5 per day for unarranged overdrafts

Just trying to weigh up the savings of a 0% card and wondering if its worth it

cheers

Moggles_2

A few rather special cards will allow you to transfer an overdraft to them, (in other words, transfer cash from the credit card to your current account), at balance transfer rates. A handling fee applies (typically 3-4% of the sum shifted), but there are no other charges during the introductory promotion (usually 12-13 months). You need:

a card issued by MBNA (e.g. MBNA itself, Sony, Virgin), Egg card or the Post Office card.

As above, to maximise the 0% period, 16 months is currently available to new customers from Virgin. There's a 4% handling charge.

http://uk.virginmoney.com/virgin/credit-cards-v3/

Have you addressed the reason(s) for building up an overdraft in the first place?

Treadmill

2.98% for a Virgin balance trasfer surely ?#

Treadmill

Blakey1982 wrote: »

cheers tread

Halifax Current account charge about £35 a month at the moment but there charges are changing in Decemeber to:

£1 per day for arranged overdrafts up to £2500
£2 per day for arranged overdrafts over £2500
£5 per day for unarranged overdrafts

Just trying to weigh up the savings of a 0% card and wondering if its worth it

cheers

Ouch @ £5 a day. Thats outrageous...

Blakey1982

Hi moggles

thanks for the reply and the information

The overdraft is the last 'bill' from a long list inherited from a previous relationship & my foolishness in trusting an ex. In total over the last 18 months i've paid off around £9k in debts. (mainly in the form of a loan i took out for £7.5k).

When the overdraft is gone (which it could be in 10 months) i'll be fine financially. I was merely trying to save money by doing it a non-costly and non-damaging way. However, if the best way is to chip away at the overdraft then so be it

Blakey1982

£5 a day is very bad but at the moment if you go over by 0.01p it charges you £28 for the priviledge of lending you money and £35 charge. So £63!!!!

There's a story of some Halifax charges on this website - in Bank Charges Forum - pretty shocking reading!!

one guy i read paid for a few wristbands on ebay by paypal which came to 0.99p each - he bought 4 all seperate charges and they came on on a Thursday. he didnt get paid till the Friday so he had:

£28
£35
£35
£35
£35
Total - £168 charges for £3.96 in 4 transactions.

Treadmill

I hope Halifax get hung out to dry when the ruling comes back about bank charges, I hope that guy is keping his statements. He should get that back plus interest

Moggles_2

Blakey1982 wrote: »

The overdraft is the last 'bill' from a long list inherited from a previous relationship & my foolishness in trusting an ex. In total over the last 18 months i've paid off around £9k in debts. (mainly in the form of a loan i took out for £7.5k). When the overdraft is gone (which it could be in 10 months) i'll be fine financially. I was merely trying to save money by doing it a non-costly and non-damaging way.

Congratulations on turning things round
:beer:
If 16 months is long enough to pay off the overdraft, you'll be fine.

2.98% for a Virgin balance transfer surely?

Yes, but you want a money transfer to your current account. You're looking at £120 to borrow £3000

Moggles_2

P.S. IMO, it's best to request your money transfer by phone (as opposed to online). You can do this when you call to activate your new Virgin card. There's a dedicated, Freefone number.

Virgin allows you to borrow up to 95% of your credit limit. The money arrives in your bank account in about 6 days