pay off creditcard & PAY nothing till next year?

yve62

I have just be given an offer from a credit card company to pay off my other credit cards which i owe 1,552.48 & to have money in my account max 4900 including paying off cards with a handling fee of 5% = 245 pounds handling fee and nothing to pay till June next year. I would love to do this for i could do with the extra cash to do a few repairs on flat that need to be done that would bring in the money and pay off within 5mths. please help current interest on card 16.9% I look forward to comments. :money:

JakeGreen

Are you sure you can pay the 5k back within the year?

What rate of interest will be charged in one year if you don't pay it back by then?

5% is a bit high for a promotional offer, as I've seen 4% offered by MBNA as standard and I've seen some at 3% for super balance transfers.

Tixy

Thats an unusual deal for a credit card company - which lender is it?

Will the interest at 16.69% continue to accrue on the card despite you not needing to make payments for a year? If so then its a fairly expensive way of borrowing if its 16.69% plus a 5% fee.
What is the APR on your other card?

Cycrow

it sounds like a super balance transfer with 0% interest for a year.
althou you would only need a normal balance transfer to pay off other credit cards

althou i agree the 5% is abit steep.

when you say from a credit card company, do you mean a new one they are offering ?

yve62

The credit card company that is offering to pay off my credit card and put cash iin my bank account is mbna and the other card is charging 16.9%

Tixy

yve62 wrote: »

The credit card company that is offering to pay off my credit card and put cash iin my bank account is mbna and the other card is charging 16.9%

So is mbna offering you a 0% promotional deal on the money transfer and balance transfer? and if its not 0% what rate will it be at?

Are you sure you don't have to pay anything for a year? You usually have to make minimum payments every month on any 0% transfer deal.

yve62

currently paying on mbna 14.9%

JakeGreen

yve62 wrote: »

currently paying on mbna 14.9%

Essentially they're offering to convert your debt with them from 14.9% to 5% for one year.

And offering you some cash at 5% for one year too which is a competitive rate for a loan.

I guess you don't have to take the SBT? and then you have 12 months to repay your £1500 debt with them for the 5% fee.

yve62

Yes i would need to pay a min of 49 pounds a mth I can only get the 4% deal via mbna if i open an new credit card so could there be a better deal of 3%

Tixy

yve62 wrote: »

Yes i would need to pay a min of 49 pounds a mth I can only get the 4% deal via mbna if i open an new credit card so could there be a better deal of 3%

Ah - that is a normal balance transfer deal then, I thought it was unusual that you'd posted you didn't have to pay anything for a year.

There are not many cards that offer the super/money transfer (the transfer to your bank account) so the fee being charged on that quite competitive. But if I read your first post right are you going to be paying this back with 5months? If so then an overdraft might work out cheaper overall.

For the balance transfer to your other card there are cards with cheaper fees, there is even a new card that charges no fee to do the transfer and offers 12 months 0% - see this list for the various fees different providers offer http://www.stoozing.com/credit-cards/balance-transfer-cards.php

Obviously this would be dependant on you being accepted for a new card.