Your opinion on a balance transfer...

DeanMoney

My current 0% balance (£5800) on my Barclaycard is ending soon so I'm looking to shift it before the deal is up, I also have an MBNA card but the rate would be 10.9%.

My idea was to close down the MBNA account (to lower my 'available credit) and go for a Post Office card with 0.33% handling and 0% interest for 26 months. The only problem with this would be if they could offer me the credit limit I require to cover the balance transfer.

Called up MBNA to see if they could offer me a deal and if not was going to cancel. They offered me 0% interest for 30 months but with a 5% handling fee.

Now the question is do I go with MBNA, take the £290 charge and have the balance paid off over the 30 months (approx £200/month, manageable) OR try and get a sufficient credit limit on the Post Office card where the handling fee would be £20?!

Now I've seen it written down I am swaying towards MBNA...

[Deleted User]

Why not try for the PO card and if you don't get it, BT to the MBNA?

than_prutt

DeanMoney wrote: »

My current 0% balance (£5800) on my Barclaycard is ending soon so I'm looking to shift it before the deal is up, I also have an MBNA card but the rate would be 10.9%.

My idea was to close down the MBNA account (to lower my 'available credit) and go for a Post Office card with 0.33% handling and 0% interest for 26 months. The only problem with this would be if they could offer me the credit limit I require to cover the balance transfer.

Called up MBNA to see if they could offer me a deal and if not was going to cancel. They offered me 0% interest for 30 months but with a 5% handling fee.

Now the question is do I go with MBNA, take the £290 charge and have the balance paid off over the 30 months (approx £200/month, manageable) OR try and get a sufficient credit limit on the Post Office card where the handling fee would be £20?!

Now I've seen it written down I am swaying towards MBNA...

Can't see any reason why you shouldn't try PO card first. Why are you swaying towards MBNA? The difference in the charge should've decided for you unless the MBNA deal only applies if you transfer the whole of £5800. Then maybe you should look to split them between the 2 cards if the limit on PO card is insufficient.

Sharon87

Agree, I mean it's a large fee, but it's also a very long 0% period. I never get offered more than 12 or 18 months with my cards, so if I was offered a 12 month 0% with a 3% fee that is actually worse than your current deal because I'd have to transfer again in a year, and then a year after that.

I would try the post office card, if not use the 0% for 30 months with the 5% fee.

DeanMoney

Thanks for the replies, think I'm going to apply for the PO card, max it out and put the rest on my MBNA, will be paid off well within the 0% period. :beer:

bearcat16

My idea was to close down the MBNA account (to lower my 'available credit)

It doesn't work quite like that, credit reference agencies and lenders usually look at the 'credit utilisation', basically % of your available credit you are using. So if, for example, you have a card with a £6,000 limit but the balance is £3,000, the credit utilization is 50%.

The lower the better, as a low % shows you have credit available but don't need to use it, and are therefore a good risk.

Closing your MBNA card and maxing out another (eg post office) card will adversely affect your credit rating as your credit utilisation % will shoot up.

So in other words, there's nothing to be gained from closing a credit card account you are not using in my opinion.

Also, a word of caution about the post office card- it's a bit of a faff to get, with them requiring bank statements and certified copies of stuff etc. Something to do with regulatory requirements in Ireland.

Personally I found Virgin Money's money transfer card (0% for 34 months) easy to apply for, all online and complete in 15 mins. 2.29% transfer fee though, which was slightly annoying.