transfer a loan to credit card... good idea?

mumof3lovelykids

we have just taken a bank loan to pay for a new car. My friend now thinks it would be a better idea to get a 0% interest credit card. Has anyone done this? Did it save you money?

The total amount over the loan amount we will be paying is just over £700 over 3 years.

If this is the best thing to do, can anyone recommend a credit card? Also how long will it take to come through, we have a 14 day cool off period from our loan so need it before that!

Thanks:rotfl:

horngkai

Depends on how much you are borrowing? Is that £700 or more? If your credit history is good, then getting a 0% purchase card will be a cheaper option. If you can't repay it within the 0% period, be ready to get a balance transfer card before the end of the 0% term.

mumof3lovelykids

Yeah, the £700 is the interest we will be paying above the loan amount. Do you know of any good deals? and time frames in getting the credit card?

[Deleted User]

But what is the amount you are borrowing?

mumof3lovelykids

We are borrowing £3800, ftotal repayable is £4600ish

ironlady2022

If you do get approved then the 0% on the card will be nowhere near 3 years. If you intend to within the promotional period your monthly payments will be higher. Alternatively you can apply for a 0% balance transfer card after it ends. This is not guaranteed of course and peoples financial situation can change at any stage.

horngkai

£3800 loan. Lets say if you managed to get the M&S credit card at 0% purchase for the first 15 months (with at least £3800 limit), and your repayment is as per the loan at £130 per month, after 15 months, there would be £1850 left on balance. Transfer that to a 0% balance transfer card for another 15 months or so normally cost 3% transfer fee which is £55.50. And you should be able to pay the whole amount off by the end of the 0% period. Thus the 'interest' for your loan will by a mere £55.50 compare to the current £700.

That is based on the current rate and offer from credit cards company. And also provided that you are approved for the limit you require.