Loan v Credit Card (or both) - Please Help

buttercreamcupcake

Hello,

First time poster here so please excuse me if i've put this in the wrong section.

Basically, my hubby has got himself a credit card debt (£4k) currently on a 0% balance transfer which is about to run out. We are currently paying around £100-£150 p/month off this so going to take a while before it gets paid off completely. I have cut the card up so he can't use it anymore.

Now his car is really playing up and we need to get another as its just been a money pit the last few years and is only going to get worse. Will get about £1k on a trade in so hubby would like to borrow £6k so that we could get a fairly reliable car (for £7k) that would last us a few years.

So, my question is: would my hubby be better to change the credit card to another 0% balance transfer and keep paying at the same rate each month and then get a seperate bank loan for £6k over say 4/5yrs to get the car, or
get a bank loan for £10k (already have one approved @ £224 p/m for 5 yrs) and pay off the credit card debt with this money and then buy a car with the rest.

I'm just really not sure which option is financially better for us over the long term and which would incur the most interest/balance transfer fees. We are looking to have both the car and the credit card paid off in the next 4/5 years.

Any help/advice would be greatly appreciated, thanks.:)

mymoney12

the loan would be secured against your house your credit card isnt. the loan totals 13440 or 2668 a year. i would try and get a 0 percent card 0r two and pay off the 2668 over the year or more if you can. sell your car private and buy a run around for a year to 18 months untill your card or cards are paid off . then you could afford a better car . i would be thinking this 7 grand car cost me 13440 and the car depriciates in value . hope this helps abit:beer:

Tixy

The loan would not be secured against the house if he took out a personal loan, the OP hasn't mentioned a secured loan.

What is the maximum amount you can afford a month towards your debts? can you afford the £150 and the £224? if he has only been paying off £100-£150 a month then are you sure he can afford the new loan repayments?

buttercreamcupcake

Thanks for your feedback, I was thinking it would be a better idea to try and pay the credit card off first and maybe just get another cheap run about or repair the existing car, I really don't like the thought of paying back all that interest on a loan and then would probably still need another new car 5 years down the line.
Tixy - it was a personal loan he looked at, not sure if it was secured or not against our house, will check. The max amount we can afford towards our debts is about £225 per month in total. It was £150 but we are going to cancel our gym membership (which I haven't used for 6 months!) so that would give us £225, would be nice if we could have got a slightly newer car in with it though, getting really fed up with the rust bucket in our driveway!