Best credit card advice

teejay66

My partner has a credit card (Virginmoney) which he's had for about 7 years now, and still has just over £2,500 to pay off. He's just realised he's paying more in interest each month than he's actually paying off, and is now looking for another card to transfer the balance, hopefully with 0% for a while, so he can get it paid off at last. He doesnt have a great credit rating, so he's not sure which way to turn. Can anyone offer some advice here?

[Deleted User]

if his credit rating is poor he may not get a 0% deal

Pheebs67

teejay66 wrote: »

My partner has a credit card (Virginmoney) which he's had for about 7 years now, and still has just over £2,500 to pay off. He's just realised he's paying more in interest each month than he's actually paying off, and is now looking for another card to transfer the balance, hopefully with 0% for a while, so he can get it paid off at last. He doesnt have a great credit rating, so he's not sure which way to turn. Can anyone offer some advice here?

If you're talking pure 'interest' (as opposed to any kind of default fees) then this goes against industry regulation.

As quoted by the BIS requirements;

The minimum payment requirement covers, at least, the ongoing costs of credit provision, thereby avoiding negative amortisation, and provides a mechanism for issuers to evaluate potential financial distress.

Essentially, even if you're paying just the minimum payment each month, your balance must be going down not up - even if by a very small amount. (assuming you're not spending on the card)

So yes, apply for a 0% rate elsewhere first to reduce the cost of the debt, but if what you say is true, I'd be questioning with Virgin why their product doesn't follow the spirit of industry regulation . . .