Lost my 0% - can I pay it off with another?

KatePlate

Hi everyone.

New to the forum and quite new to credit cards - my understanding of it all is limited so forgive me if this is a silly question!

I got a 0% credit card last year for big purchases etc. I used it to help fund buying a car. There is about £1,600 in there at the moment.

Stupidly I didn't set up a direct debit and I missed a payment, which means I lose my 0%. I called Virgin and they kindly lowered the 17% (!) interest rate down to 5%which is better, but obviously I'd rather not pay any at all. I wouldn't have got a credit card in the first place if it wasn't 0%.

So my question is this - Is it possible for me to get another 0% credit card and use that to pay off the balance on my Virgin one? Therefore meaning that I will be back to just making monthly repayments (with a direct debit!!) and paying no interest? Or would I have to pay interest on the new card because it is moving money rather than buying something?

I have read through some info on the site but I'm getting confused with balance transfers etc and not quite sure what it all means so I need someone to dumb it down for me! Also I'm terrified of getting a bad credit score...not yet a homeowner so don't want a bad one when I do try to apply for a mortgage so don't want to do anything that will affect this either.

Many thanks in advance

YorkshireBoy

You get yourself a 0% credit card with a good BT offer (eg long duration and 0% BT fee).

You ask the new provider to BT the debt from the Virgin card.

Once you've received a zero balance statement on the Virgin card (the first will have some residual interest) you close it down.

You're now in exactly the same situation as you would have been with Virgin, had you not forgotten the payment!

Nebulous2

Yes you can get another credit card and pay it off. A balance transfer is exactly what you need.

You aren't guaranteed that you could get one though, with the missed payment possibly counting against you. Even if you do get one there is no saying what the credit limit will be. A big factor will be your wage and any other debt.

Virgin haven't been as generous as they could have been. If you ask nicely and hold your hands up companies will often reinstate your 0% deal on the first occasion.

KatePlate

Great. Thanks for your replies. Maybe I will ask nicely again at virgin to see if I can avoid the extra hassle and if not then I will do as you say.
Appreciate your help!

chattychappy

5% is still not bad. If you were to pay down the balance over a year, then the interest you'd pay would be roughly 2.5% of the present balance.

Many balance transfer cards charge a 3% up-front free. So my suggestion is that if you do indeed obtain a new card and the fee is around 3%, then only transfer what you think you can't pay off during the next year*. If you can pay off the whole lot within a year, then don't bother getting a new card.

(Of course you'll still have to make minimum payments against the transferred balance right away, so factor this in.)

Hope that's clear. If not, I'll try to illustrate what I mean.