Does this sound like a good plan?? Advice needed please

losethedebtlou

Ive just been acceppted for a 0% balance transfer credit card with natwest and plan to put my £700 (12%:mad:) overdraft over on balance transfer. I currently pay this off at a rate of £100 per month which means it will be gone well within the 0% transfer time limit Happy with that!
I also have a car on finance at around 19%:eek: The credit limit on the card will allow me to pay off the finance if I wished. The APR for purchases is 0% for 3 months and then 16.9% after. My thoughts are that I should pay off the finance with the card, then sell the car for around £5000. I can then use £3000 to buy myself a smaller more economical but reliable car and use the remainder to pay some off the CC. This will then free up around £300 per month for me to pay off the rest of the CC. Does this sound like a good plan?? I am very wary of CC's as thats whats got me in trouble in the first place:p Please note, I have NO INTENTION of using the card for anything else AT ALL. It will be getting cut up after I go ahead and pay off the car finance. Also if the car stays on finance it is draining £300 a month from my bank account (a lot if which is interest) and I cant sell it, which I want to do as its costing me £100 for 6 months car tax:eek: £40 per month in insurance :mad: and uses a hell of a lot of petrol. I would really like to downsize to a more economical car. Im unsure as to wether this is a good plan as I dont want to end up in even more trouble. Please advise! :money:

theoretica

I would check very carefully before you get attached to this plan. You may not be able to transfer the money to cover your overdraft from your card to your bank account at the balance transfer rate- it may count as a cash transfer at the higher rate. Also paying off your loan may count as cash transfer not purchase. Check it out very carefully!

losethedebtlou

Just spoke to my bank and paying off the finance would count as a purchase (which is at 0% for three months!) so i am going to go ahead and pay off the finance with the card i think. Providing the credit limit covers it that is, cant find out until after easter hols hope it does cover it!!

losethedebtlou

oooh good advice from theoretica the overdraft wont be able to be added as a balance transfer so i am going to leave that where it is and put the car on the card, I will then throw money at the card and get rid of the debt. After this I will pay off my overdraft as the APR is lower than the card after the 0% goes away

Poosmate

Hi Lou, yep that sounds like a plan. Hope it works out for you and hope you can sell your car quickly. You should be able to get yourself a nice car for £3k.

Congratulations on what you've achieved so far.

Poo

Blonde_Ambition

Hi. Just sticking my nose in. I wanted to downsize my car (VW Golf) a little while ago as I was finding the £200 a month payments a bit tough. I looked into trading it in but soon realised that I could take it into a dealership and they would take my car off me and swap it for a smaller, older, lower spec car (Polo) for the same amount! I reckoned I would lose about £2000 in the trade, so for me it wasn't worth it. I just tightened my belt and now own the car. However, if you're not sure you like the car for other reasons too, it might be worth it in your case. Good luck!

losethedebtlou

The car is doing my head in, so expensive to tax and insure. Economy is my main concern because I spend a lot on petrol. I can get another 20 mpg at least out of a polo so thats the main reason for getting rid! Seen a nice polo diesel for less than 3000. Clears 2000 of debt and will be a lot cheaper on fuel! Cant wait to get rid!:j