Should I move loan to credit card?

tjak

I have an existing HSBC loan which has approx £7k left on it, due to finish in August next year. Interest rate is 7.9%

I have recently taken an MBNA credit card which is offering a balance transfer of 0% until April next year, 3% fee.

Should I transfer the loan (I can transfer cash to my bank account and then repay loan) as I should have a lower redemption figure, and then repay it before the 0% runs out? I am sure it will save me money, but what do you think?

Thanks

Tixy

Probably won't work out massively cheaper (but probably slightly cheaper).

You'd need to know what the actual balance on the current loan is - and what the early settlement fee is.

From the info you've posted and guessing that the repayment is about 525 a month (for it to be repaid by August) - you'd be looking at around £335 in interest if you keep the loan.

To transfer to your card you'd pay £7000 x 3% so £210 plus probably an early settlement fee of 1 months interest of around £45 - so would cost you around £255. That would therefore be a saving of around £80, but only if you can afford to clear the card debt by April next year.

(also are you certain its 3% for a money transfer? they are often 4% on MBNA cards, which would then mean virtually no saving at all).

These are just a rough guide of course - without knowing exact figures and terms.