Credit Card Transfer Query

Caatalyst

Hi Everyone,

I'm going through a pretty tough financial period and I'm trying to take the best steps possible to get myself out of debt

My income isn't very high at the moment, I'm newly self employed. I've been generating enough income to get by but a chain of events has crippled me financially and so here I am looking to resolve the situation.

I'm going to reveal quite a lot of personal information but i think it's necessary to get the advice I'm looking for.

Currently I have two sources of debt;

£2000 student overdraft with Halifax
£730 Credit Card with Halifax

The situation has become quite critical because my student account is about to expire next month and It will be replaced with a current account where I will start to receive £1/p day charges for the £2000 overdraft. It was initially £2500 but I managed to scrape together £500 over the last 2 months and get it down so that the rates were lower.

Additionally I pay between £16-£20 a month on my credit card. I've had the credit card for years and the balance has been at it's highest point for the majority of this time.

I also just want to say, I've been a pretty sensible student. I've had to be because I have little support financially. The main reason I'm in this financial state is because I decided to do an intern as part of my third year unpaid whilst running a second job over the weekends.

So I've now been looking at what the best course of action is, I want to avoid quitting self employment because I've worked so hard to get where I am and things are started to turn around now but it will be into summer next year before I really start to see the benefits.

Apologies for the big back story! I just thought it would help bring clarity to my situation.

So here I am now looking to make the most financially sensible move.

I've just made my first credit card transfer from Halifax One to Barclays. This was to take advantage of the 0% interest for 23 months.

Much to my surprise they provided me with a £2750 credit limit. This left me with just over £2000 (minus the original balance that was transfered from Halifax).

This is where I am looking for advice. I'm wondering if it would be more sensible to withdraw the remaining £2000 and pay off the soon to be current account overdraft.

This would max out the new credit card at £2750

It seems to make more sense because at least then the repayments will not be charges or fees, but instead I will be actually paying off the card for the 0% period. All I'm doing is moving the debt to what seems to be a much more logical destination as I'm confident that I will be able to completely eliminate this balance within 23 months.

My other question is regarding cash withdrawels. As part of the credit card promotional offer it states;

0% interest for 23 months from account opening
with a 3.2% handling fee on balance transfers for
any eligible balances transferred to your account
within 60 days of opening your account. The amount
transferred must not exceed 90% of the available
credit on your account. 0% interest on purchases for
3 months from account opening.

Does the 0% interest on purchases also include cash withdrawels? If not what can I be expecting to be charged for a £2000 withdrawel and is there anyway I can transfer the money to the account with the overdraft?

Thank you very much for any responses, I will provide more information if necessary.

James

Caatalyst

****
I just wanted to add a few bits of information to my post that might be useful.

If I was to not take the path of using the credit card I would be looking at approximately £60-£70 a month in payments. These payments would be about 95% fees and charges.

If I was to use the credit card option I would be paying the same amount but it would actually be more likely to be 100% repayments. By that I mean paying off the debt.

This is if I have read through the contracts correctly and that I can go down this path.

Sheriffsam

I am not sure if you can do a cash transfer with this barclaycard. Others might no better. If you can, then yest you can use the card to pay off the overdraft, and take advantage of the 0% balance transfer, however if not, do not just take out the cash as you will pay a hefty rate on the cash you take out.

Check the terms to see if a cash transfer or super balance transfer is available with this card.

Caatalyst

I can't seem to find anything about cash withdrawels, whether their discounted or free for a limited period or how much that it would actually cost if not.

Caatalyst

Interest free period
Maximum 56 days from date of transaction for purchases
and for non-sterling cash withdrawals if you pay your balance
in full and on time each month.

No interest free period on cash advances or balance transfers
(this is subject to any interest free promotional offer).
Interest charging information
If interest is payable, it will be charged from the date the transaction is
debited to your account until it is paid in full.
Interest is charged on your average daily balance. By repaying more
of your balance, or by making your repayments earlier, you will pay less
interest.


I found this but I'm not sure really.

Caatalyst

Right I've had a look into it and I found this information on the barclays website about the platinum credit card;
It's good to know the plain facts about this Barclaycard. This Summary Box gives you clear infomation about the key features of the card and does not replace any terms and conditions.
APR 17.9% APR Representative (variable).

Interest rates

Introductory rates Monthly interest rate Yearly interest rate

Purchases 0% for 3 months from 1.385% 17.9%
account opening

Cash advances N/A 2.075% 27.9% Balance transfers 0% interest for
23 months from account
opening with a 3.2% fee on 1.385% 17.9%
transfers made within
60 days of opening your account.
The amount transferred must not exceed
90% of the available
credit on your account.

Interest free period
Maximum 56 days from date of transaction for purchases
and for non-sterling cash withdrawals if you pay your balance
in full and on time each month.

No interest free period on cash advances or balance transfers
(this is subject to any interest free promotional offer

___

So there is no promotional offer on cash advances.

What I'm unclear of is how much exactly I would be charged for making a cash advance and if it is worth while to remove the £2000 overdraft which is costing me £1 a day.

Although it states that cash advances will still be charged for, how will this effect the 0% promotional offer? Does it just mean that I will be charged for the withdrawal but still pay 0% on my monthly repayments?

If anybody could help me with this information I would be very grateful.

Regards

James

Caatalyst

That information didn't cop very well from the barclays website.

If you google search 'barclays credit card transfer' and select the platinum offer and click on 'read summary' box the information is all there.

Thank you.

Tixy

Your overdraft is cheaper than a cash withdrawal from the credit card at 27.9%.

You would be charged interest on the £2000 cash withdrawals at 27.9% APR based on the infor you have reposted (which would equate to £41 in the first month), plus the actual withdrawal fees as well.
Your small balance transfer balance would continue to be 0%.

As an aside - could you possibly look for part time employed work, to supplement your self-employed income for the next few months until your business improves, which would allow you to put more towards the debt each month.

Caatalyst

I think that is looking like the best course of action, thanks for your response Tixy!