Credit Card Balance 0

wigglykoala

Hi

I earn £21,500 and I have a lot of credit cards with a balance of 0. The credit available to me equals about £17,000. All of the cards have a high APR now that the Balance Transfer offers are over so I wont be using them. (I dont have the card in most cases.)

I have an overdraft of £2500 which I live in and want gone quickly as I spent £20 a month on interest. The bank offered me a loan of 24.9% to pay off the overdraft but that doesn't seem like the best move.

My question is:
I've never been offered such a high APR before could it be because of all the credit available to me on credit cards?? Is is best to close all of these cards? I heard that having a credit card improve your credit score, but surely 6 could be having a negative effect.

(with regards to the overdraft I am going to follow advise from another thread and open a second current account and transfer spending money over every month until paid off)

Tixy

The credit you have available is likely to be effecting the rate you would get. Plus rates are generally much higher these days, and for a loan of £2500 you might not get a great rate.

Couple of options - what cards do you have open with nil balance? are any of your credit cards ones that allow a super balance transfer? If they are then you could phone them up and ask if they have any transfer deals at the moment. If so you could transfer money to your current account and pay off the overdraft (remember to cancel it or at least most of it). You would pay a one off transfer fee (usually 3-4% of what you transfer) and then would have probably 12months to clear the credit card. If none will give you such a deal then consider cancelling the card.

Either way I would make sure you cancel probably at least 4 of your 6 cards. Always worth keeping at least one for section 75 protection on big purchases, for emergencies abroad and to keep an active credit history. Personally I think 2 is a good idea, but you don't necessarily need high limits on them both.

List of cards that do money transfers to your current account http://www.stoozing.com/sbt.php

wigglykoala

I have two that would be able to do this, I'll give them a call and find out. And I'll cancel all but the lowest one at £500. Cheers I had a sneaky feeling they could be doibng damage.

Tixy

Yep

Its generally suggested that having credit exceeding 50% of your income is affecting getting new credit these days.

Do check that any BT deal they offer you will still apply for a money transfer. Just in case any of your accounts are old and have slightly different T&Cs. You don't want to end up with a full cash rate on a card.

wigglykoala

Ah thanks for that. I was just about to ask how I go about transfering money into my bank account as you usually have to provide the credit card number.