Take out a 0% Money transfer card to pay 10% off mortgage?

Bizzywizard

Hi Everyone,
I cleared all my debt in December 2020 and have saved up to redo my large amount of manky 80's fencing and 70's garage. This will be completed by the end of June.
I know myself and DH can get a 0% money transfer card, I think about £5k each. This would then pay off my 10% mortgage allowance.
Has anyone else done this, or is it a no no? We would be looking to do this in July.
Thank you in advance!

[Deleted User]

It's only a no no if the figures don't stack up. Compare the fee to the interest you're paying and then plan how to pay it off.

If the card debt moves to the go-to rate, you'll lose in a heartbeat. 

Bizzywizard

Deleted_User said:

It's only a no no if the figures don't stack up. Compare the fee to the interest you're paying and then plan how to pay it off.

If the card debt moves to the go-to rate, you'll lose in a heartbeat. 

Thank you for your reply!

The 0% interest card is over 15 or 18 months, but I would want it paid within 12 months from July. My mortgage rate is 2.4%, so its an ok rate, just not as good as other peoples cheaper rates.
Have you used a 0% money card to do, what I am thinking of?

[Deleted User]

What's the fee on the card? I can't imagine you'll pay less than by simply paying the mortgage from your income - especially if you plan to pay the balance off early.

You'll need the fee to be around 1% to even get to breakeven.

Bizzywizard

Deleted_User said:

What's the fee on the card? I can't imagine you'll pay less than by simply paying the mortgage from your income - especially if you plan to pay the balance off early.

You'll need the fee to be around 1% to even get to breakeven.

Feel like a plonker now!
The rates is 2.99 with MBNA, so its a no no!.
Thanks for your help!

edinburgher

Bizzywizard said:

Deleted_User said:

What's the fee on the card? I can't imagine you'll pay less than by simply paying the mortgage from your income - especially if you plan to pay the balance off early.

You'll need the fee to be around 1% to even get to breakeven.

Feel like a plonker now!
The rates is 2.99 with MBNA, so its a no no!.
Thanks for your help!

I thought it a little unusual you'd found a no fee money transfer card, was about to ask who it was with!

getmore4less

The good old days of stoozing are not as good now.
(yep it has a name)
you used to be able to get 0% fee free but those are very rare now.

You can cycle cashflow through a purchase card to get true 0% savings.
With offset you borrowed the money,  offset it for the term of the CC deal and then paid it back at the end.

Bizzywizard

Thank you guys!,
I was just thinking of the 0% money and not the transfer fee. So the stoozing days are over, I remember about reading this a long time ago.....clearly I missed the boat again lol!

AnnieB2018

Paying a fee for 1 year is better than paying interest on that 10k for another 10-15 years. No?

[Deleted User]

AnnieB2018 said:

Paying a fee for 1 year is better than paying interest on that 10k for another 10-15 years. No?

No.  You're comparing a 1 year term with a 15 year term.

Rather than pay a 2.99% fee on 10k for a year, the OP can pay 2.4% APR on a declining 10k balance over a year.