another credit card or loan which one!

Gemmzie

Yes, 'fraid so.

Are you still in the 0% transfer first month? Could you move it somewhere and then back again? I know you'd pay a transfer fee but that's gotta be loads less than the interest?

Robflh

Hi tsharp

You will have two balances on the one credit card but your statement will only show the total balance. You can have multiple balances on one credit card.

If you pay £100 more then the minimum payment, the £100 will come off the balance with the lowest APR. At the moment, that is the 0% balance.

If you can, transfer the amount to another card and it will be at a balance transfer rate plus a transfer fee. Transferring it back to the 0% card would mean paying another transfer fee and may cost you more then the interest you would be paying.

If you can, next time use another card and transfer the debt to the 0% card. There is a minimum that you can transfer.

If you leave the money where it is, the first month you will pay interest on £108 the second month it will be on £103, then £98, £93 and so on. It will cost you about £10 in interest and then both debts will be at the same interest rate.

At this time an extra payment of about £60 will kill the rest of the £108

tsharp

Thanks all. I noticed that the RBS card has a 3 months % free period of purchases, which I am still in. What difference does this make? (I am hoping the answer is not; nothing, they will still leave the purchase til last to be paid off)

Robflh

Hi tsharp

That is an interesting question. You would still have two balances but both balances would be at 0%. Therefore, I would say any amount you pay over the minimum would be split equally between the two.

In which case, you would have to pay about £200 more then the minimum payment to get rid of the £108 purchase.

If the 0% on purchases has three months left you could pay about £70 a month more then the min for the next three months.

However, I would first ring RBS and ask them what happens in this situation.

tsharp

Thanks guys, that makes it a bit clearer.

I think I maybe ok, cos over the next couple of months I will be making large payments to the card due to wedding gift contributions, so this should amount to way more than the £108 purchase. In theory, that should kill off the £108 purchase within the 3 months, thus incurring no interest fees.

glitzy

Robflh wrote: »

Hi glitzy

So, you have a surplus of £348.23 each month and paying that off the overdraft for the next three months will kill the overdraft.

Pay for the holiday with the IF credit card (£1,200) and as soon as the balance on the M&S card falls below £4,750 transfer £1,200 to it from the IF card.

You will have to pay a transfer fee of about 2.5% (£30) but the holiday money will be at a low, life of the balance rate.

Once you have killed the overdraft, pay as much as you can each month off the M&S credit card. At a guess, I would say you have about ten months left on the two 0% credit cards.

Everyone has their own way to do this, so this is how I would do it.

When the 0% offers are about to end, Apply for a new card with a 0% offer and transfer the outstanding balance from the HSBC to the new card.

Hopefully, this will clear the balance on the HSBC card. Now transfer as much as you can from the Tesco card to the HSBC card and then as soon as you can kill the Tesco card.

Pay the minimum on all the credit cards except the one with the highest interest rate and pay as much as you can off this one each month. When this card has been cleared, kill it.

When the 0% offer on the new card is about to run out apply for a new card and transfer as much as you can to it from the card with the highest interest rate. If you can transfer more to the new card transfer it form the card with the next highest interest rate.

Keep your Cash Flow up to date and on the first day of 2008, save it as Cash Flow 2008. Keep an eye on your budget, so that it does not get out of control. The less you spend the more you can pay off the credit cards and the quicker you will get rid of the debts.

Keep a note of my log on name Robflh and then if some time in the future you cannot post to this thread, you will be able to send me a private message.

hi Robflh a very big thank you goes to you for all your help and advice, it is much appreciated. I didnt make myself clear - if we didnt have an overdraft we would have a surplus of £348, but as it stands now, after we have been paid £1000 of our wages, this effectively clears the overdraft, so our incomings is £1000 less, if you know what i mean. The if card for life balance was only on the balances if you transferred in the 1st month, but i think there is a new one i havent tried, so i think i will apply for that. I hope even though you are on incapacity benefit and you cannot get credit cards that it doesnt get you down too much, cos think of everyone you have helped on this site - we need people like you to guide us in the right direction, and all your instructions are clear and precise. Anyway thanks for all your help x

dreams_R_free

Thanks very much indeed, Robflh, for taking the trouble to respond to my comments re 0% balance transfer cards.:beer: .

I know I have far too many cards(and consequently too much available credit) to successfully apply for and get a new 0% one yet. The balances are coming down gradually but I want to kill all the high interest ones and start afresh with the lowest possible interest(preferably 0%). I've learned my lesson the hard way and intend to stick to just a couple of cards in future. Not easy for a self-confessed credit card junkie:rolleyes: .

I keep meaning to get hold of my credit report but always chicken out because I'm afraid it might read like a horror story and freak me out:eek: . I'll take your advice and really do it this week. Thanks

I've already struggled to pay off 2 of my cards in full and cancelled them last week:j. I was wondering what would show up on the credit report and how soon after the cancelling it would show. It took nerves of steel on my part:rotfl: not to be talked into keeping them(with increased credit limits too but no chance of a low interest rate:mad: ) when I phoned to cancel.

Take care
Imp

Robflh

Hi glitzy Hi Impomdasp

Keeping a tight control on you budget is only half the solution. The other half is to reduce how much you are paying each month in interest. The less you pay in interest the more you will pay off the credit cards and the faster you will get rid of the debts.

If you can get one, apply for any of the credit cards that have a 0% offer. I think Capital One has one for about ten months. As soon as you get your new 0% card transfer to it as much as you can from whichever card has the highest APR or the lowest BT rate. If you still have room on the new card, transfer a balance to it from a second card.

The credit card companies want your money and with any luck, you now have a credit card with a reduced balance or if you are lucky, the BT completely cleared that credit card.

Let’s say you now have an empty credit card (old1), you could kill this card or you could ring old1 and ask them what percentage rate they will give you if you transfer a balance to their card. They often have two, one is at a very low APR for a short period of time and the other is slightly higher but it is for the life of the balance and it is the second one that you use.

Transfer a balance from your second highest APR or lowest BT rate credit card (old2) to old1 and with any luck old2 will now be empty. Repeat the process as many times as you can or need to and then kill the last credit card.

Before you transfer a balance from old1 first check that they will allow you to make a balance transfer and the same goes for your other old cards. Also check which one will give you the best BT rate and then make a few more phone calls and see if any of the others will bet that rate. Then start transferring money from the one that will give you the lowest BT rate.

This can save you as much as 66% of the interest you were paying. The last time I was able to do it, I saved over £100 a month in interest.

Remember, they often have two BT rates, so once you have paid for something or several things with one credit card you can transfer that debt to another card and have that debt at a balance transfer rate, as low as 0%. Ie. Paying for a holiday.

glitzy

Maybe your my lucky charm robflh, as Mint who im with have just offered me 5.9% p.a balance transfer until repaid and it has just 2% fee - so i wont have to apply with someone new and have my credit score affected - is that right? yippee if so ive beat the system!

NekoZombie

glitzy wrote: »

Exactly but my husband is stubborn and thinks we should move if we cant afford the house - i think we can afford it if we clear the overdraft as we would have an extra £1000 a month. As for sky he likes his home comforts and you will not believe this but he has just got a gym bench & weights in the garage, i did mention is he going to cancel the gym but he needs to do cardiovascular, whatever that is when its at home.

Apologies if this has already been said, but I think your maths is wrong here. If you clear your overdraft, you clear the debt but that doesn't give you another £1000 a month. If you spend into your overdraft again, then you will need to pay it back, again...;)