Balance Transfer questions

mitcheldolby

Hi everyone.

I have a few credit cards from Barclays that I am paying off the minimum each month. I cant afford to pay more.

I owe £7000 between the 2 cards and I want to apply for a 0% balance transfer.

However, I have read here that transfers are only temporary (like 22 months)

I wont be able to pay the whole balance in 22 months, so what is the likelyhood of successfully moving the balance to another 0% transfer once the 22 month period is finished?..thereby changing cards untill the debt is paid?

Tixy

Very much depends on what happens in the credit card market, and also on what happens with your own personal finances etc.

What APR are you paying on the barclaycards?
If they are at fairly average standard APRs and if you do manage to get a new credit card with a 0% promotional balance transfer rate with a high enough credit limit then at least you will get the benefit of the reduced interest for a period of time. You'll need to factor in the balance transfer charge to your calculations as well.

But whether you will be able to get a new promo card with that size limit now will very much depend on your finances, your income, your credit history.

I'd also be looking to try to find ways to increase the amount you pay each month. Have you been through all your outgoings to see if there is anywhere you can save money / get things cheaper / make cutbacks. £7k with just minimum payments is going to take you a long time to clear, even if you were able to get succesive 0% deals.

thenudeone

I don't know what rate you're currently paying but for illustration, if your Barclaycard interest rate is about 20% APR, then you are probably paying nearly £190 a month to Barclaycard, most of which is interest. After 22 months you will still owe most of the £7k.

If you carried on paying £190 a month to the new card after after transferring the balance, then after 22 months you will have paid off £4180 of the balance (although the BT fee will be between £200-350).
That's a hell of a chunk of the debt cleared away, so even if you can't get another 0% deal you will almost certainly be better off.
[Strictly speaking the best thing to do is put any excess over the minimum payment into a savings account and only pay it to the card just before the 0% deal ends]

What you must resist is the temptation to spend the money saved because the monthly repayment is lower. Your 0% deal hasn't saved you anything if you just spend more to cover it!

mitcheldolby

Thanks for the replies.

My credit history is ok. All my bills are paid up to date and regular, but my finances are totally stretched.

About the only luxuries are the internet and mobile phones. No days out, no meals in restaurants..nothing like that.

Most of my repayments account for a small fraction of the balance and I think it would make sense to look for a balance transfer.

Thank you very much for your replies. Much appreciated.

Tixy

If your finances are totally stretched and you can only meet minimum payments you may well struggle to get any new credit.

Any new potential lender will be concerned as to whether you can afford to service a new credit card debt on top of all your existing debts.

It makes sense to see if you can get a balance transfer, but if you are declined then don't keep making lots of applications.

Idiophreak

I've never had a problem getting another card to transfer my 0%s on to, but it's very personal. (and the increasing balance transfer fees mean you can't view it exactly as 0% any more, any way).

If you haven't already, you should post an SOA on the DFW board and see if there's any fat that can be trimmed from your budget. If you could pay off the whole debt within the 22 months, you'd be much happier.

Also, look at the "up your income" board to see if there's any extra money you can earn to put toward the cards...