Paying off a loan with credit card

jjf238

As the title suggests, is it a good idea and how do I do it?

John

Tixy

Its a good idea if it works out cheaper overall.

You can do it only with a few specific cards that allow money transfers (aka super balance transfers) to pay money from your card to your current account, these are principally the cards that are backed by MBNA (such as virgin) and post office cards. Some other cards occasionally offer money transfers to existing customers (such as barclaycard).

There are also 2 other cards that allow similar transactions M&S and Tesco - with these you can get the money into your current account using the 'travellers cheque loophole'.

When working out if it will be cheaper overall you'll obviously need to consider the current APR you are paying, what the balance transfer fee will be, what the card APR will be (and if its a promo 0% deal, whether you'll have paid by the end of the 0% deal), and how much you can afford per month.