Loan or Credit Card?

Fledgling07

Hello,

I'm hoping for some advice please. I'm looking to go back to school and study for three months in the new year which will cost £5100 inc VAT, on top of that the three months tuition fees there will be living costs at approx £2000. I've got enough in savings to cover the living costs and a bit extra whilst I'm out of work but the real question is this:

Is it better to go for a £5000 loan over 5 years at a fixed 3.8% so total amount to repay £5493.75 = £91.56 per month repayment or use my new credit card (0% for 30 months) to pay £4600 with 3.5% charge from the school (already paid £500 as a deposit) so total amount £4761. If I wanted to pay the amount within the time frame I would have to pay £158.70 per month however I could pay less than that and then transfer the balance to another card once the 30 month time frame was over?

Which is the better route to take on this?

[Deleted User]

A few thoughts -

Why take a £5k loan if you only need £4,600?
Can you get a loan at 3.8%?
Can you afford the credit card debt at the go to rate if you can't BT it?
How quickly will you be able to get back into work?

Fledgling07

If I went for a loan of £4500 over 5 years, total amount to pay back would be £5551.35 at 8.9% APR, fixed interest at 7.6% - monthly repayment of £92.52.

I've been applying to see what rates I would be offered and yes Zopa have offered a 3.8% fixed rate. By the time the 0% runs out, yes I will be able to afford the debt and as part of the course you get placed with a company for 2 months so once the course ends I should already be in work or should be able to get back into work straight away

foxy-stoat

Fledgling07 wrote: »

If I went for a loan of £4500 over 5 years, total amount to pay back would be £5551.35 at 8.9% APR, fixed interest at 7.6% - monthly repayment of £92.52.

I've been applying to see what rates I would be offered and yes Zopa have offered a 3.8% fixed rate. By the time the 0% runs out, yes I will be able to afford the debt and as part of the course you get placed with a company for 2 months so once the course ends I should already be in work or should be able to get back into work straight away

If you have applied and been accepted for a 3.8% rate loan then do that, otherwise I would use the credit card and do the 0% interest shuffle until its paid off.

I cannot see any flaws in your plan if you can get back to work instantly and you have £2000 in cash to live off for the next 3/4 months and pay back the monthly repayments.

Let us know how you get on!