money tranferring to save interest? worth the hit on credit file?

Farcasting

Hey everyone looking for some advice,
I have a £7250 o/s on a TSB Loan @ 23.9%.

I've been Pre approved
for a MBNA Credit Card £2800, 0% on money transfers for 12 Months 4% Fee
and a Tesco Credit Card with a limit of £5300 for 0% on money transfers for 40 Months. 3.94% Fee

If i was to pay £600 a month off my loan after 14 months id clear my loan but i'd have paid £930 in interest

If i money transfer to my Bank, since i can only transfer 95% of both i'd just be transferring enough to cover my Loan.

so lets just say 4% fee for £7250 would be £290 and i could pay my loan off at TSB.

is it worth doing this to save £640 or will the affect 2 new credit card applications have on my credit file not be worth it?

If i were to do the transfers i'd pay them both off within 12 months.

hope this makes sense

Cheers,
Farcasting

redux

If you use the full 40 months on Tesco, and new spending on MBNA and pay in full each month, you don't need a new credit card for some time, so why worry about credit rating.

And you might earn some interest in a couple of bank accounts while saving up pay the Tesco card later.

Farcasting

redux wrote: »

If you use the full 40 months on Tesco, and new spending on MBNA and pay in full each month, you don't need a new credit card for some time, so why worry about credit rating.

And you might earn some interest in a couple of bank accounts while saving up pay the Tesco card later.

Yeah That's what I was kinda thinking so the applications won't really affect me aslong as I don't apply for credit again? Is it 6 months before applications drop off, I'm currently paying off all my debt but id rather do it at 0%

redux

I don't know about how long application searches stay on, maybe 6 or 12 months.

It's probably discussed in some MSE article, or someone else with more knowledge will be along to reply.

Nebulous2

I understand people are concerned about maintaining a good reputation with credit providers when they are intending to apply for credit, such as a mortgage.

I worry about people becoming a slave to it though, especially if, as in this case, it will cost you money.

Your TSB interest rate is high, in fact it's very high. You've worked out a plan to reduce it and been accepted for the cards. I can't see a downside to it at all, unless you can see a need for more credit fairly soon. I'd go for it .

Good Luck.

SuperAllyB

For those kind of savings, doing the transfers is a no-brainer. Be wary of the term "pre-approved" though as what they are actually willing to offer may vary in terms of credit limit, length of offer or possibly fees. Still worth shifting as much as you can in any event.

takman

The entire point of maintaining a good credit report is to get financial products to save you money, so yes definetly go for it it would be silly not too!.