Balance Transfer More Than Credit Limit

moneymoron1

Hello,

This is my first post for a long time, reading back on some of my old posts i was in a very bad position and whilst my amount of debt is still very high most of it is structured now. I am hoping this will vastly reduce my number of credit accounts but i don't know if it is possible.

I will try to be quick, i have the following debt that is costing me money in interest.

£3000 Halifax Overdraft £2 a day costs
£1500 TSB Overdraft
£2500 Santander Overdraft
£2500 Credit Card
£1000 Store Card
£1500 Credit Card
£1000 Credit Card

I have just successfully applied for another credit card with 0% for 30 months. I was hoping to get around a 2-3k credit limit and move two cards over. I have actually been given a 15k credit limit. I am hoping this is a chance to restructure my multiple accounts into a lot fewer accounts. It is NOT a money transfer card unfortunately.

On my credit cards that have £1500 limits, could i transfer more than that, say 4k to put my credit card in a positive balance by 2.5k. Then use that positive balance to either withdraw to my bank, or withdraw as cash to clear my overdrafts?

I would then look to do the same again to keep going to clear and close some accounts?

Thanks

mm1

moneymoron1

Feels like a spam response

Voyager2002

The answer depends on whether or not any of your existing cards are what Martin calls "super balance transfer" cards (all of which are issued by MBNA), which do allow you to make payments to your bank account. Otherwise, you would have to contact each card issuer beforehand to ask what happens if your account becomes positive: they might agree to transfer the credit balance to your bank account, but might simply return it to the new card.

jamesd

You can't transfer to a card more than the limit on the card and a common limit is no more than 95% of the credit limit. The limit on the cards that you want to transfer the balances from doesn't matter at all.

Since you have a card with a £15,000 limit you can transfer over all of the credit and store card balances.

You can then spend on one or more of the other cards for all possible daily spending and use the money you're not spending to reduce the overdrafts. Then before the deadline for balance transfers under the new card's terms, do another balance transfer to move this newly accumulated balance to the BT card.

It often breaches card terms to put on a credit balance but you could transfer enough to a card to cover the spending you plan, just so you don't have to do more transfers later. Best to spread this over several cards to reduce how much over nil balance you go.

It is possible to put cards into a credit balance and I've successfully withdrawn the credit balance at both NatWest and Barclaycard, though Barclaycard indicated that they didn't like to do it. It's not certain that you will be allowed to do this, they can just refuse and return it to where it came from. The spending way is certain to work.

grumbler

moneymoron1 wrote: »

On my credit cards that have £1500 limits, could i transfer more than that, say 4k to put my credit card in a positive balance by 2.5k. Then use that positive balance to either withdraw to my bank, or withdraw as cash to clear my overdrafts?

You can try your luck, but most likely the card provider will insist on returning the money back to where it came from. Again, if you are lucky you will possibly get the BT fee back pro-rata.

The only reliable way of doing this fast is to pay the cash advance fee for withdrawing cash from some CC or having money transferred to a current account. Then transfer the balance from this CC to the 0% card.

The way of doing this slowly is spending on other CC, using the saved cash to pay the overdraft(s) off and transferring the balance to the 0% card. However, 0% cards often stipulate a short time window for BTs qualifying for 0%.

moneymoron1

Thanks Voyager,

They aren't "super balance transfer cards" but that's a good idea regarding ringing them to ask about what happens to the money.

I could keep withdrawing cash and balance transferring to the new card with the high limit but that takes time and i may lose the rate

Red-Squirrel_2

Nope, won't work.

You must have a good credit history to be offered that limit, so it would be simpler and better to just get all of your cards transferred onto that 0% one and then either apply for a money transfer card to take care of the overdraft, or apply for one that's got a long 0% on purchases so you can do all your day to day spending on it and use the cash it frees up to get rid of the overdraft.

You'll still have two cards, but its a lot better than the current situation.

moneymoron1

grumbler/james,

Thank you, i think going the cash advance fee route is probably the easiest way to do it.

I should be able to do it all within a couple of weeks if i am quick withdrawing the money and doing the balance transfers.

It would finally be nice to shift that halifax overdraft at the very least

jamesd

moneymoron1 wrote: »

I could keep withdrawing cash and balance transferring to the new card with the high limit but that takes time and i may lose the rate

Then just put all of the other cards a bit into credit, spreading the £7,000 of overdraft balance money evenly among the four cards. Don't put a card into credit by more than its credit limit, though, that'll be sure to look strange and might attract attention. Spread the spending over them as well, so they see that you're doing something to reduce the credit balance.

Grumbler is right that withdrawing cash is another way but there will be a fee for doing this, on top of the balance transfer fee. Spending is cheaper.

moneymoron1

Red-Squirrel wrote: »

Nope, won't work.

You must have a good credit history to be offered that limit, so it would be simpler and better to just get all of your cards transferred onto that 0% one and then either apply for a money transfer card to take care of the overdraft, or apply for one that's got a long 0% on purchases so you can do all your day to day spending on it and use the cash it frees up to get rid of the overdraft.

You'll still have two cards, but its a lot better than the current situation.

To be honest i am really shocked at the limit i was given, especially seeing as i have two other cards with that company.

My credit rating has recovered, but i was trapped in a 2 year pay day loan cycle that absolutely crippled me and led to me borrowing thousands from family to escape it without a DMP or IVA.

One of my credit cards that i need to transfer is the same company as this new one which is another reason why i may need to go the cash advance route

moneymoron1

jamesd wrote: »

Then just put all of the other cards a bit into credit, spreading the £7,000 of overdraft balance money evenly among the four cards. Don't put a card into credit by more than its credit limit, though, that'll be sure to look strange and might attract attention. Spread the spending over them as well, so they see that you're doing something to reduce the credit balance.

Thanks again,

That's a good idea, i may transfer 500 or 600 more than the credit limit to give me a chance making the process quicker