Can a loan be paid off with a CC??

mandy6979

Can a car finance loan (Capital Bank) be paid off using a credit card? I got a settlement figure for our car loan (£7,500 with 3 years and 9 months remaining), but would like to pay it off quicker than that using a 0% credit card.

If i paid £7,500 to Capital Bank using my RBS credit card with £9,000 credit limit on it, I could then transfer the £7,500 to a 0% new card, thus paying it off quicker with no interest. I got a flyer in the post 2day from Citi Platinum Mastercard offering 0% on balance transfers until 1st June 2007 with max £75 balance transfer. I'm thinking of applying for this card and would pay minimum £300 a month. Just now my loan repayments are £192.

Has anyone had a citi CC and if so, what was the initial credit limit set at? We have a joint income of approx £50,000 and only have 1 loan and 1 credit card with £99 on it, which will be paid off at the end of this month. I received a credit report today and every score is 0, so I always pay on time.

Grateful for any advice. Thanks.

Moggles_2

Hi Mandy

In theory this is possible.

Cards issued by Royal Bank of Scotland normally provide 'money transfers' straight to your bank account. These are limited to around 50% of your credit limit, so you would need to transfer the RBS balance to a new 0% card and then repeat the process. I did this recently using my Mint card (same stable). A small amount of interest accrues until the debt is transferred to the new card.

My reasons for doing this were different from yours though. The risk in paying off a loan this way is that you can't be sure of another 0% offer in X months time when the Citi deal ends.

Also, factor in balance transfer fees which are becoming hard to avoid and check the loan Ts & C's. Some lenders charge an early repayment penalty if the loan is settled in full before the scheduled date.

Very best
M