Can I pay off a loan (approx £1500) with a 0% card?

iwanttobreakfree

Well not specifically me, my mum has offered to put my outstanding balance on a card so it accrues no more interest. Can this be done and if so how? If she pays it off with a card will she need another one with 0% to then class it as a balance transfer?

Before anybody questions its because my managed loan follows the base rate (which I wasn't aware of) and therefore it will stop any potential increases in amount of payments. I figured a 0% credit card is the best way to save money


Cheers guys for any help!

CLAPTON

She can't simply 'pay off' your card with her card.
She will need a CC that has 0% for BT and then simply BT your balance to her card. She may want to check, but there is usually no problem in BTing between cards with different names... they usually only want the card number. There will be a 2-3% BT fee.

If you are not sure that the balance will be paid off before the 0% runs out it might be better to look for a low life of balance card instead.

iwanttobreakfree

i can definitely pay it off in 12 months. easily. i probably didn't explain very well its a loan account so there would be no card number to give for a balance transfer. Would she have to effectively "purchase" the amount of the loan and then balance transfer from one card to another with 0%

sorry if im confusing but im confused myself!

CLAPTON

no its not normally possible to 'pay' off the loan with a CC.
But some CC will allow you to BT from a current a/c (an imaginary overdraft) so then you an simply pay off the loan from your current a/c
The MBNA stable of cards allow this as does eggmoney card

iwanttobreakfree

When i spoke to HSBC yesterday they said as long as my mum lives at the same address as me then its fine (god knows why?!) to pay it off with a credit card. so fingers crossed it all goes to plan! - Am i right in thinking only HSBC could object to it being paid by a credit card or can the credit card company complain that its paying off a loan?

CLAPTON

She will need to get a settlement figure from the loan company ... so it may not actually be worthwhile if they add any penalty interest but you need to get the figure (in writing of course) before making the decision.

I'm a bit surprised that HSBC will allow a BT from a loan but if they will then yes the loan company will agree too. You are sure they realised it is a loan and not another credit card?

Chai_2

Hi, i work in a bank dealing with loans and we dnt accecpt credit cards. If HSBC have authorised the credit card then as stated before you would need to make a payment with your mums cc as you cannot do a BT. So as long as the card has the 0% on purchases then it should be fine.

Hope this helps
Cx

EvilScotsman

I used my credit card, which had a 0% interest rate, to pay off my car loan which was at 8.8% APR. I also used a different 0% card to pay off an unsecured loan I had as part of my mortgage. Just check that there are no early repayment charges for paying it off in full.

Regards,
Derek

knowledgeman

It can be a grey area

I work for a bank and our systems are set to automatically decline certain types of trans including credit transfers

The systems can be overridden and it then really comes down to our own discretion as to whether we will allow it.

As for it being interest free, it depends how the loan company bill it, if it comes through as a cash type tran you could find yourself paying cash interest

Tbh you wont know until you try