Another Trick I wasn't aware of! VW finance

MikeR71

Hello everyone:

I bought a car two years ago taking advantage of the dealer's own cheaper interest rate and started paying it off monthly. The deal will end in October 2011 by which time I will have paid the car off. There is roughly £3000 left to pay of this.
So naturally I thought I can pay it off on my credit card and then move my balance to one of these 16 month 0% transfer cards. Right?
This makes sense as I won't be paying the 11% that VW is currently charging me and by making the same monthly payments to the credit company instead I will clear the £3000 in shorter time.

So I phoned up VW finance and offered to pay off the car now but low and behold, apparently they don't accept credit cards! I can only pay by debit card or cheque. When I asked why she said it's company policy that they do not accept credit cards.

I try not to be cynical but I think there is only one explanation that makes financial sense and that is they know exactly that their customers will put the balance on a 0% card meaning VW lose out on the interest rate.

What can I do now? There is no way I can put £3000 on my debit card. Is there anyway around this so that I can take advantage of the free 16 month transfer?

CHR15

Some credit cards allow you to transfer that money into your current account so you can take advantage of their offer.

If your card allows that, move the money across, then pay VW off with the cash in your current account.

It all depends on the Credit Card.

Paying credit with credit (as you are trying to do) has never been an accepted method.

Tixy

If you were planning to get a new card to move the debt onto then try using one of these cards which will all allow you to transfer the cash to your current account - http://www.stoozing.com/sbt.php

Not quite 16months but still not bad. Though you will pay money on the transfer so factor that in to any calculation you make.

MikeR71

Thanks for the replies.
Yes I am aware of the 3% that most cards charge for transfers.

Regarding stoozinig, I have heard of it but haven't managed to find a card that let me borrow as much as £3000 and pay it some months later.

Tixy

Do you mean you have applied for cards that allow money transfers (as per that list) but not been accepted for one with a limit of over £3k?
And if so why do you think you will be accepted for the 16month 0% card that you mention initially?

MikeR71

No Tixy. I haven't actually applied for cards that pay cash without charging interest.

But from what I understand, all these offers (listed on your link) charge a %age so the money they give you is never free.

Tixy

No they wouldn't be free, it would cost anything from 2.9-4% of your balance.

But in your original scenario you wanted to move it to BT 0% 16month cards. That won't be free either. I guess you meant a natwest/RBS one - they would charge 2.9%.

MikeR71

Yeah, in my original scenario I worked out that even with the fee added I would end up paying less for the car than I am paying VW finance.

Tixy

Isn't this super transfer card solution exactly the same cost as your original scenario though?
2.9% fee of £3k

MikeR71

Yes, but I will have to pay roughly 4% to get the £3000 into my current account right? That's more than 2.9% which makes a difference on £3000. Anyway, it's too much hassel for a little benefit. Hardly worth it.

Tixy

Egg is 3%, Post office 2.98%, so not much more than 2.9%.

But I would agree whichever option you chose it isn't going to save you a fortune, probably say £100 or so at best.