Flawed logic or cunning plan?

mountainofdebt

As I've posted else where, OH has been refused for a couple of credit cards which were earmarked for replacing the two cards coming to the end of their 0% deals, one of which I realised last night will be attracting interest at 23% :eek: :eek: :eek:.

Anyway I wandered into the credit union shop today and found out the following:
if I joined up, 8 weeks after saving with them I could take out a loan, at 6%, for up to twice the value of my savings. This loan would have to be repaid within a year but could be repaid earlier without penalty and interest is calculated on a daily basis.

Once this first loan is repaid, a 2nd loan can be applied for and this can be up to 3 times the savings with the union. Once this loan is repaid, a 3rd loan could be applied for and this loan can be up to 4 times the savings held.

So (and here's were you lovely people come in) is this worth doing?

The downside that I can think of is that whilst I am saving for the 8 weeks I could be putting this money towards the debt at the highest rate but the upside after that I could reduce the interest rate on double that amount by nearly 8 times.

What are peoples thoughts?

southernscouser

I haven't got a clue to be honest! :rotfl:

Were you given any reasons why your OH was rejected? :think:

mountainofdebt

no we weren't ...just given the standard have a look at your credit report letter.

What did concern me was that one letter stated that they looked at the credit report of those people who were financially linked together as well as that of the person who was applying, which if that is the case then I'm not surprised they turned him down...especially as the debt is in my name cos I'm prepared to move things around abit.

The only other thing I can think of is that we were late with a Barclaycard payment but given the way we've managed our accounts, especially in the last year, I can't see that being too much of a problem.

Oh well something to sleep on I think!

Haven't done anything either about the matched betting either - perhaps that should go on my to do list for the weekend as well eh?

dawn2dusk

I have only heard positive reports about credit unions. They run all round the country by people that help each other,especially for people with poor credit.They have one in my own city.they have a web site.
http://www.fsa.gov.uk/consumer/04_CREDIT_DEBT/mn_credit_union.html
perhaps members witth more experience might be able to help. CAB will be able to give you an inpartial view.Sorry could not any more help.

CLAPTON

credit records cost £2 per CRA ...not a lot really (only three agencies)