Balance Transfer Advice

colonelburnell

Hi guys,

I currently have two credit cards:

Credit card 1 is with HSBC. I have had the card for almost 10 year and built up a substantial balance on the card. Last year I transferred the balance to the Virgin MBNA card. I still use this card for expenses and now religously clear any balance on a monthly basis. The credit limit is 10,000.

Card 2 is the Virgin MBNA card above. It also has a limit of 10,000. The balance on it stands at 6,000 against which I am currently paying £500 off per month. I am not paying interest on the balance but this offer ends on 12 July. My balance then will be £4,500.

I would like to transfer my balance from card 2. Now I am going to first approach HSBC and see if I can get a 0% deal. Should I fail, I will look elsewhere. Should I reduce my limit on the HSBC card from £10,000 down to £1,000 which is the maximum I spend (work exps) on a monthly basis. Would reducing my limit help or hinder me in applying for a new card.

You should also know that I will be getting married next year. I will have savings to pay towards the wedding but also expect to need to borrow in the region of £4,000.

My current plan is that after transferring my balance is to reduce my monthly repayments assuming it's a 0% deal. I will then shove the increased funds in to my savings.

My credit score is good and my repayment record is exemplary.

Thanks in advance for your advice.


Colonel

Ralphy101

As far as I am aware, having too much credit available will hinder your credit profile. Delicate art, as you still want to be able to have credit, to show you can manage it.

I personally would, reduce the limit on HSBC card to something like £1k ( as you've said). This will reduce your available credit, and give you more chance of being accepted for other bank's 0% balance transfer deals. Having too much credit available will make the banks think "high Risk".

After reducing your limit have a look at Barclaycard - they are offering a 20 months 0% BT deal at the moment ( albeit a slightly higher transfer fee at around 3%). This may be more suitable for you, and will reduce your payments down to around £300.00 ( give or take) as opposed to £500.00. Giving you an extra £200.00 to go on your wedding.

Just a word of warning going forward : Be wary of card tarting too much, Banks score negativly with anyone to whom they feel are "playing the game".