Will I save anything?

tenmah

Hello

I have a loan with AA personal finance. It started at £9500 and I pay £195.43 monthly which includes the monthly interest, plus I have just started to overpay when I can. The interest on this loan is 8.35%.

The outstanding balance is £4500.04 and I have just been given a credit limit of £5000 on a 0% Virgin credit card (until Aug 2010).

If I balance transfer the remaining amount, am I saving anything? I mean I realise I should be saving the 8.35%, but as that is included in my monthly repayment, I can't see what I would save by transferring? Am I missing something?

Thanks

jennihen

What is the rate on the Virgin card if you don't pay it off before Aug - 10 months away?

CLAPTON

yes, paying 0% on the virgin CC is less interest than paying 8.35% (even taking into account a 3-4% BT fee)


however, whether it will cost in depends upon what happens after the promotional 0% ends... will you have paid the debt in full or will you then need to pay the CC high APR?

tenmah

Well I was kind of hoping I would be able to balance transfer again at the end of the term, to another card. By then it would only be around £1500, so should be ok!

I aim to pay off £300 per month, so on the £4500 with AA, that means I would pay it in 15 months, and if I transfer it to Virgin and pay £300, (I know I would have to transfer again, but what I mean is it would still take the same amount of time) - what am I missing?

tenmah

Oh it is ok, I have just realised that the balance they have given me as a settlement figure, is actually £300 less than I owe, so that is where I will be making the saving!

Sorry - should have thought about it before jumping the gun!