What would you do, which deal to take?

supersaver2

Looking for some advice please.

I have 2 credit cards, MBNA and Barclaycard, both interest free currently and paying as much as I can and not using them!

My MBNA interest free runs out on May 20th this month, Barclaycard is interest free until November 2016. Now I've been offered numerous promotions by both card providers including another years interest free and also a low interest for the life of the balance deal on both cards.

I know my financial situation will change next year and I will lose some income so I am tempted by the low rate for the life of balance but is this crazy when I can get interest free instead? I am able to swap the balances on both cards with a bit of juggling about!

I've worked out I'll pay approx £22.00 per month interest on my debts to start (clearly this will reduce as time goes on). My debts are currently £7200.00 across both cards.

What would you do in my situation? Take the interest free and run the risk of that running out next year and me being stuck or take the secure rate but pay interest?

I'm leaning towards the low rate of interest offer (MBNA - 0.4034% & Barclays - 0.575)

Interested in thoughts.

Thank you.

grumbler

I would use 0% as an opportunity to pay the debt off before the income drops.

supersaver2

grumbler wrote: »

I would use 0% as an opportunity to pay the debt off before the income drops.

Thanks but I won't be able clear all the debt in the next 12 months unfortunately.

bigadaj

supersaver2 wrote: »

Thanks but I won't be able clear all the debt in the next 12 months unfortunately.

So put what you can comfortably clear within the next year into the 0% card and the remainder into the low life of balance rate.

Many things seem to initially be a binary choice, but a middle way is often the best.

cheesetoast

Consider that doing a 0% transfer every year will incur a transfer fee of around 3%, so if you're being offered a 4.9% for life rate, it suddenly doesn't look too bad.

supersaver2

cheesetoast wrote: »

Consider that doing a 0% transfer every year will incur a transfer fee of around 3%, so if you're being offered a 4.9% for life rate, it suddenly doesn't look too bad.

Good point, the low rate for life has no fee, the balance transfer has a fee of 3%.