Balance transfer

Yonke

Hello,
I'm hoping someone can give me some advice on my credit card debt. I only have one credit card (Co-operative bank Clear card) but since last years moving house, getting married, honeymoon and husbands 30th it's taken quite a beating and my minimum payments are now reaching the max I can afford to repay each month, so the interest is mounting up...
- Do all credit cards allow a balance transfer to pay it off?
- Can you set the monthly repayment amount when you apply for the card?
- What if the months at 0% interest are less than the amount of months it takes to repay the card - would I then be able to transfer that balance to a third card?
- Alternatively could I look into a loan to pay it off instead of a balance transfer?

Thank you in advance.

grumbler

Yonke wrote: »

- Do all credit cards allow a balance transfer to pay it off?

Do you mean allow transferring the balance to another card?

- Can you set the monthly repayment amount when you apply for the card?

For a DD it's normally either a minimum payment or a full one, but some cards allow other options. Nothing stops you paying any amount manually or by a Standing Order.

- What if the months at 0% interest are less than the amount of months it takes to repay the card - would I then be able to transfer that balance to a third card?

Yes - IF your can get a third card that offers 0% on BTs.

- Alternatively could I look into a loan to pay it off instead of a balance transfer?

Of course you can, but unless your CC APR is sky high, I don't think that monthly loan payments are likely to be smaller than your CC minimum payments.

And generally, BTs are cheaper than loans:

• Balance Transfer Credit Cards
• Cheap Loans

Was it really worth splashing money on honeymoon and some birthday to get yourself into this situation?

Yonke

Thanks for your reply. Balance transfer it is then I think.
- Yes I mean transferring the balance to another card - it this always possible or do some credit cards not allow it?
- I currently pay manually as much as I can each month - my concern if I transfer the balance to another card is if the minimum repayment could be more than I am able to repay.

I have completed the eligibility checker but it asks what my current bank is - my current credit card is with Co-op, but my main current account is with Santander - any idea which one I should put down for this?
Also when it asks for monthly income, is this just my income or household? My main account is joint with my husband and both salaries are paid into it.

And yes the honeymoon was fantastic and worth the money - I could continue paying the minimum but am trying to take control of the situation quicker (also I am no longer spending on credit and we're not having a holiday this year!).

jonesMUFCforever

OP take care here you seem to be on the edge here if minimum payments are a struggle.


Is there no way you can either increase income or reduce outgoings or sell something to pay back some of the debt - good luck.

grumbler

Yonke wrote: »

Thanks for your reply. Balance transfer it is then I think.
- Yes I mean transferring the balance to another card - it this always possible or do some credit cards not allow it?

How can it be not possible? It's just a money payment from a new card to the old one. That said, technical problems are not uncommon for some cards (not Coop AFAIK), and the new card has to be not from the same banking group.

- I currently pay manually as much as I can each month - my concern if I transfer the balance to another card is if the minimum repayment could be more than I am able to repay.

It can - check the Summary Box for the new card - but at least the payments will eat into the debt.

I have completed the eligibility checker but it asks what my current bank is - my current credit card is with Co-op, but my main current account is with Santander - any idea which one I should put down for this?

I am pretty sure it's the current account.

Also when it asks for monthly income, is this just my income or household?

Yours - unless it specifically says 'household'.

And yes the honeymoon was fantastic and worth the money - I could continue paying the minimum

There is no anything positive in this, especially as you are already struggling even with minimum payments: Minimum Repayments credit cards - BEWARE!!

but am trying to take control of the situation quicker (also I am no longer spending on credit and we're not having a holiday this year!).

Problems with making minimum payments and just one year? I think you underestimate the seriousness of the situation.

Yonke

Thanks for your support - I am *hopefully* due a pay increase in a month which will help. I also have some money in an ISA but I'm reluctant to use it for this...

bigadaj

Yonke wrote: »

Thanks for your support - I am *hopefully* due a pay increase in a month which will help. I also have some money in an ISA but I'm reluctant to use it for this...

Whilst it's good to have an emergency cash fund, in an isa or elsewhere, saving at 2% and paying interest at 20% is a crazy thing to do.

Pay down the cc debt with the isa money and then make sure you save up and put money back into savings, that would save you a. Packet.

grumbler

Yonke wrote: »

Thanks for your support - I am *hopefully* due a pay increase in a month which will help. I also have some money in an ISA but I'm reluctant to use it for this...

This would make sense only if the yearly cash ISA limit was much lower than you could save during a year after repaying the debt. This seems not to be the case even for the old £6K limit, and certainly isn't the case for the new £15K limit.

It doesn't make any sense to pay 13%+ interest on your debt while getting ~2% on your savings (that is absolutely the same as borrowing on a CC for putting money into ISA).

>> Should I Repay Debts or Save?

Yonke

Thanks Grumbler, I have been like an ostrich with my head in the sand really.

As a lot of the balance transfer cards I've been looking at tend to be 0% for 30 months or so I've presumed that I'll clear my debt in that time (I won't be paying for any holidays before!).
I wouldn't say I'm struggling to pay the minimum yet - I am paying more but not much more, and there are ways I might be able to increase this, but probably not by a huge amount.

My other thought was do I have to transfer the whole balance? But this worries me as paying off two cards instead of one might lead to more trouble not less.

I think I'll apply for Halifax and see what they offer me (am I right that there is a cooling off period where you can cancel if you change you mind or they don't give you enough months at 0%?)

Thanks again for your advice.

Stereo

Yonke wrote: »

My other thought was do I have to transfer the whole balance? But this worries me as paying off two cards instead of one might lead to more trouble not less.

You don't have to transfer the whole balance. It would make financial sense to get the balance on to one or two cards that are at 0% for a period of time. And because minimum payments are always a percentage of the balance, it wouldn't mean you were paying more each month. It just means your balance would be coming down without interest being added every month...

grumbler

Yonke wrote: »

My other thought was do I have to transfer the whole balance? .

No you don't have to. If you get a new 0% card it makes sense to transfer as much as possible. Theoretically you can get more than one new card.

But this worries me as paying off two cards instead of one might lead to more trouble not less.

I don't see any, but possibly it's just me.

I think I'll apply for Halifax and see what they offer me (am I right that there is a cooling off period where you can cancel if you change you mind or they don't give you enough months at 0%?)

I don't see any point in cancelling if you are accepted. Every little helps.

Stereo wrote: »

...And because minimum payments are always a percentage of the balance, it wouldn't mean you were paying more each month.

However, the percentage vary and can be higher (or lower).