Loan or balance transfer??

SSmith_2

Hello all,

My husband and I have £7,000 debt currently on a credit card which we switch backwards and forth on 0% balance transfer rates.

We are wondering whether it would be better to just transfer this debt over to a fixed term loan, the benefits then being smaller monthly repayments and a fixed term but the minuses being the interest and it taking longer to pay off?

We're just not sure if it’s better to pay the balance transfer fees each time we transfer to a deal or pay the loan interest?

Can anybody comment on what they think?

Thanks in advance

somethingcorporate

If you can get a loan rate better than the fees then go for it (but I don't think you can).

Use an online calculator to work out what you'd pay for a loan and then just pay it down against the debt - it's hardly rocket science. Just turning into a loan does not magically make it easier to pay although I guess the psychological impact of making it mandatory if you lack financial discipline may mean it would be more likely to be paid off.

Tixy

You say that your monthly repayments will be lower with a loan.

How much are you currently repaying a month to the credit cards? Are you paying just the minimum payments or more than that?

forgotmyname

Personally i think you need to make a pact to get rid of the card. Concentrate on getting it cleared before the interest free period runs out. No more transfers to another card to extend it.

Fix a date and pay at least that amount each month as you would a loan and cut the card up so you cannot add anymore debt to it.

Why pay interest when you dont have to. Just takes that much longer to pay. Get strong and cut the spending and pay off as much as the loan would cost each month.