Paying off car finance

stalkah

Hi Everyone,

So not that long ago I would have struggled to get any credit and as a result got a car loan with a pretty high APR because we needed a car. Anyway times have now changed and I've got two 0% credit cards for 12 and 15 months with a total of £11k available credit!

The car finance is with MotoNovo and the settlement figure is about £6.5k. If I carry on paying the standard payments the total with interest would be £8.7k so it seems this should be the first thing to go on the 0% cards. I've had a look and MotoNovo charge 3% credit card fee but that is only £195, my nationwide card also offers 0.5% cashback so would bring that £195 down by £32.50.

Hopefully with my new found thirst for being debt free I will have saved enough to completely pay this off in 12 months and will then be debt free

Everything to me seems pretty straight forward, but as this is the first kind of stoozing I will be doing and pretty new to all of this I thought I would ask if there is anything I should be wary of? Or is it really as simple as paying off the finance with the two cards, making above minimum payments on the credit cards and then save the cash in my high interest bank account ready to pay it off before the end of my 0% period?

Thanks

Tixy

You need to establish from your credit card company how the payment to pay off your existing loan would be treated.
I assume you cards are 0% on purchases, so you need to check it would be treated as a purchase (sometimes paying off loans/paying other banks is treated as a cash advance which wouldn't then be covered by your 0% deal)

stalkah

Thanks Tixy, I will try and give them a call tonight to confirm.
Just as another thought, is there anything stopping me from paying for it on one credit card and then balance transferring it to the new card?

stalkah

I have spoken to Nationwide and they have confirmed I am ok to pay off the loan with the credit card their words
"A cash advance would only be considered a cash advance should you take money out via either in branch or ATM, or a gambling or betting transaction; these types of transactions are consider a cash advance"