How can I Transfer overdraft and credit card balances

dilalio

Time to put this in order...

As I have read in other recent posts, Barclays new o/d charges will have costly consequences for many, including me.

I have an o/d of £3150 which I use all the time, up to the full limit, and have done for at least a couple of years. It costs me around £35pcm to have this, plus the odd charge when I exceed it and my monthly platinum fee.

Having finally got through to customer services (in India), I have learned that, under the new charges, this will now cost me around £95pcm - basically, they are trebling their charges!

I also have a Tesco credit card with a balance of £2000, which I pay £50pcm to. I don't use this card for purchases or cash. Just try to get it down and the £50pcm pays the interest and a little of the balance each time.

I'd like to put these two balances together into an %free credit card and get rid of it over #months. But not sure if you can transfer an o/d AND credit card balance to a new card?

I did also consider applying for a top-up on my mortgage to cover these but not sure if this is feasible or cost-effective!

If I leave things as they are, I'd be shelling out around £150pcm without making a dent in either debt!

Can anyone advise how I might best do this?

Many thanks.

asparagus1968

hiya,


it's usually not a good idea to transfer UNsecured debt (OD/CC) into secured debt (your home is at risk if payments are not met etc etc)

you would need to see if you could get a 0% card with a big enough limit to fit both onto.that would depend on your circumstances/ debt history etc.

or maybe you would find it easier to get a low interest for life of balance card, if you are just paying it off, not using it.

Overdrafts are counted as cash advances though, so incur a higher fee to balance transfer, be careful with that.

Think I'd be tempted to ring your current CC company, tell them your situation, they will want your business I'm sure so see if they can offer a good deal for the whole amount.

Also, if you are DEFINATELY not going to need credit, and are just paying off the approx. £5,000 you could get a loan for the whole amount, lower interest. But.....

ONLY IF YOU CANCEL CREDIT CARD AND OVERDRAFT SO YOU DO NOT USE THEM AND WRACK UP MORE DEBT!!!!!!!

dilalio

Thanks for the suggestions.
Seems like I have some scope here!

Ideally, the 0% for #months is the way I'd like to go.
How do I research/enquire as to which vendors might allow this dual transfer and what they would charge?

I'm wary about contacting them as I believe they treat enquiries as an application which then goes on my record/file! Am I wrong about this?

asparagus1968

http://www.moneysavingexpert.com/credit-cards/



couldn't you ring the CC people, not give them your details, just say you currently have a CC with them, £xxxx at x%. you would like to add £xxxx from an OD. what deals do they currently have?

Tixy

To do a transfer to pay in to your current account you need a card that allows money transfers (and that has them on a 0% promo deal). Very few cards offer these now, the main one being MBNA cards.

So if you could get a new MBNA card with a high enough limit you could transfer to pay off both the overdraft and the tesco credit card.

That said you need to work out how much you can afford to these debts a month without reusing any other cards or overdrafts.

So far you have only been paying £85 a month combined to both (£50 + the £35) and not reducing the overdraft at all, so you need to look at your finances and find ways to free up more money to go towards your debts each month.

asparagus1968

if a total other CC, I think the OD balance transfer is called a "super-balance transfer" so look into cards that allow those.

dilalio

Ok. Just had a look at MBNA, MSE application tool says I have a 90% chance.

With this card...
To get rid of the o/d would involve a 4% fee on £3150 for a money transfer
= £126

Plus;

Transfer of cc balance fee of 2.89% on £2000
= £57.80

Total of £183.80 in fees, to set this up.

Then, I would have 29 months of £177.59pcm to pay to zero the balance.

This is obviously more than the @£85 I'm currently paying but I would have the option to pay the minimum and transfer the balance again when the 29 months are up, if I haven't managed to zero it. I should also be getting a better salary soon so that should help me achieve the target.

I can't think of a cheaper way to do this, unless I can find a bank that will offer me the same od facility without those extortionate fees!! Then I could just transfer the cc balance to a 0% card?

Scritti

I agree that a money transfer using a 0% card is the right thing to do and well worth the fee - it's what I would do if I still had my OD

Virgin are also doing the same offer if this helps (hope this link works)...

http://uk.virginmoney.com/virgin/credit-cards-v7/?source=MSP-BTR-51366-65937&utm_expid=7287642-49.VTtOizZjSXGn2DB6bQ9fNQ.0

longtermplanner

I think you Have A Plan. It's not bullet proof, but it looks like a sensible way forward. Good luck with getting the card.

dilalio

Could I make it more bullet proof?

I do intend to try my current provider first to see what they might do to retain my custom! (I think it helps to consider oneself as a customer rather than debtor!)

I"ll also look at other banks about perhaps transferring my a/c including the o/d.

Tixy

I'd try for the MBNA card as a first option. The fees are certainly a lot better than sticking with your current overdraft.

If the limit isn't high enough for both current debts then maybe you might need to think of other options for some of the debt.

There are some accounts that have a interest free overdraft but I don't think you'll get anything for the level of your current overdraft debt (nationwide offer a 12month interest free overdraft, although the limit is likely to be much lower than £3150).

In terms of the bullet proof comment they key will be to ensure you don't run up more debt on top of what you transfer to MBNA. Don't use the MBNA for anything other than the BTs and if you keep your existing Tesco card don't use it for anything you can't afford to repay in full each month..
Also consider removing (or significantly reducing) the overdraft facility if you stick with barclays and don't use it except for emergencies.