Overdraft - Balance Transfer?

Bagely

Here goes...
I am new to all of this and I'm really keen to make the best next steps.
I currently have two store card accounts (less than £500 balance each) and an overdraft of £750. My overdraft charges are horrendous (£1 a day).
Is it possible to get a 0% balance transfer credit card to help me pay the debt off at a cheaper rate? Any thoughts would be appreciated please.
I am just preparing to do my first post in the debt-free wannabes section too.

bigadaj

Bagely wrote: »

Here goes...
I am new to all of this and I'm really keen to make the best next steps.
I currently have two store card accounts (less than £500 balance each) and an overdraft of £750. My overdraft charges are horrendous (£1 a day).
Is it possible to get a 0% balance transfer credit card to help me pay the debt off at a cheaper rate? Any thoughts would be appreciated please.
I am just preparing to do my first post in the debt-free wannabes section too.

It's possible, though you need to get a card that does money transfers to your bank account rather than a normal balance transfer, all is explained in the mse guide.

Moving the money obviously doesn't solve the problem, just reduces the interest, so you also need a plan to pay this off and build an emergency fund.

molerat

You need a money transfer card, definitely to clear the overdraft and probably for the store cards as they may not have a recognisable card number to transfer.

dresdendave

Another option, although it would be a more gradual process, would be to get a 0% purchases CC. Use this for as much of your spending as possible, which should see less money coming out your current account, therefore reducing your OD.


Once the OD has disappeared, throw money at the store cards.


Remember this isn't actually getting rid of the debt, you'll still have it but at 0% interest. You need to take on board all the advice you get on the DFW board and keep attacking the debt with any money you free up from reducing your outgoings.


This is suggested as a backdoor method of transferring your debt to 0% if the money transfer option isn't possible.

YorkshireBoy

Depending on your typical monthly spend currently made on the debit card and any existing credit card, you may be a long time before you see a benefit from a 0% on purchases card due to the fee-based overdraft cost.


If a money transfer card isn't an option, maybe consider a Nationwide FlexDirect current account for it's 0% overdraft facility for the first 12 months. DO NOT switch initially...get the account opened and any facility granted before initiating any switch.