Are capital one credit cards cheaper than payday loans?

AlexEFC

basically i am stuck in a bit of a rut. i have payday loans (around £500 spread across 3 companies) that i am paying back and then having to take another one out (or deferring them) as i can't afford to pay them back right now. the capital one card is 34.9% apr and is the only one i could be accepted on due to bad credit score.

if i was to get one of these cards and pay the payday loans off then pay as much (around £100) as i can a month to pay it would it be cheaper than deffering each month?

InsideInsurance

Compare the APRs the lower APR will be the cheaper option.

The problem will be if the payday companies accept credit cards to start with and secondly if Cap1 consider them a cash advance or not - if it does then it may either not be possible or have an even higher interest rate but that will be documented in your T&Cs

camuk81

Whats the apr on the payday loan

AlexEFC

The rate of interest which applies to the credit agreementYour finance charge will be calculated as a flat fee equal to 16.00% of the total amount of credit and at a fixed of 201.38% per annum.Annual Percentage Rate (APR) 547.56%

think i just answered my question. the monthly rate for the cc is 2.53% and an annual rate of 34.94%. i know it isn't ideal to do it but really want to get out of this payday loan cycle. if i pay £100 a month of a £500 credit card balance i would hopefully be in a better posistion in a few months then just use it for emergencies / improving my credit score

AlexEFC

InsideInsurance wrote: »

Compare the APRs the lower APR will be the cheaper option.

The problem will be if the payday companies accept credit cards to start with and secondly if Cap1 consider them a cash advance or not - if it does then it may either not be possible or have an even higher interest rate but that will be documented in your T&Cs

is a cash advance the same as a cash withdrawal? that is a 3% fee plus the same apr

camuk81

Cash withdrawal and cash advance are different as there are usually different apr attached

camuk81

Default Sums:
Late or failure to pay default sum£12
Returned payment default sum£12
Overlimit default sum£12
Returned credit card cheque default sum£12.00
Our reasonable court costs and expenses for collection, including tracing, and retrieving cards.

Other Charges:
Cash withdrawal handling fee:3.0% of amount withdrawn, minimum £3
Foreign transaction fee:2.75% of transaction value
Balance transfer handling fee:3.0% of the amount of the transaction
Copy statement fee: £3 per copy (maximum £10)

camuk81

This is taken from the progress t & C but actually you would be fine pulling cash. Other then that see if the PDL will take a credit card payment over the phone

AlexEFC

camuk81 wrote: »

This is taken from the progress t & C but actually you would be fine pulling cash. Other then that see if the PDL will take a credit card payment over the phone

so if they wouldn't i could just withdraw the cash for the 3% then pay it into my current account then pay the PDL.

cheers, seems this is the best of a bad bunch to get it paid and free from PDL's

Snowedunder

Also, bear in mind that it is possible that the Cap 1 card limit would be as low as £200 to begin with, maybe for as long as 6 months, so would this really help?

AlexEFC

Snowedunder wrote: »

Also, bear in mind that it is possible that the Cap 1 card limit would be as low as £200 to begin with, maybe for as long as 6 months, so would this really help?

if that is the case i will just use it as suggested in the bad credit cards to just help build credit up, use it for small purchases and pay off before interest is charged.