0% Balance Transfer cards for people on Universal Credit

SaraD

Hi there,

For the last 6 years I've been reducing my debt by using 0% balance transfer cards and have never defaulted.

A few months ago I was made redundant (Covid, of course) but continued to pay the minimum amounts on the 2 cards I already had. The 0% terms are now expiring (this month) but it seems there is no card I can transfer to - at least nothing I can find for my circumstances.

More info:
-  I am mortgage free
- The amount to transfer is £2350 
-  My credit 'score' is fine
-  I do actually have enough in savings to cover the debt - in fact, I put some savings in to reduce the debt - but times are tough and I need to keep a little back in case, for example, the car conks out. 

It's as if there is a gap I've fallen through despite following all the right steps.

Any advice?

Thanks :-)
Sara

[Deleted User]

Pay down the debt and ignore the credit score. Lenders will assess you in your risk, not the CRA score. 

Low income and revolving debt is a high risk scenario for lenders.

SaraD

Deleted_User said:

Pay down the debt and ignore the credit score. Lenders will assess you in your risk, not the CRA score. 

Low income and revolving debt is a high risk scenario for lenders.

Thanks - I do realise the CRA thing is mostly irrelevant, it was just a bit of extra info. It's easy to say 'pay the debt' but as I said, that leaves me personally at risk if I encounter a domestic emergency or my car finally gives in. This is the point of my query, i.e. is there any OTHER option? But thanks for the reply :-:smile:

[Deleted User]

Consider paying off part of it, while keeping an emergency fund. 

You won't get any decent offers in your circumstances, so see if any other cards in your collection have a lower standard APR you could BT to.

phillw

SaraD said:
Thanks - I do realise the CRA thing is mostly irrelevant, it was just a bit of extra info. It's easy to say 'pay the debt' but as I said, that leaves me personally at risk if I encounter a domestic emergency or my car finally gives in. This is the point of my query, i.e. is there any OTHER option? But thanks for the reply :-:smile:

You aren't at risk, as long as you can put your emergency bills on your now cleared credit card.

https://www.moneysavingexpert.com/savings/pay-off-debts/

If you keep the savings you'll definitely be carrying an interest bearing balance, if you pay the card off you'll only be paying interest in an emergency.

Borrowing from friends/family or increasing your income are really the only other legal options you have.

Then there are also questions like, if the car conks out then do you actually need a car if you are not working.

SaraD

Deleted_User said:

Consider paying off part of it, while keeping an emergency fund. 

You won't get any decent offers in your circumstances, so see if any other cards in your collection have a lower standard APR you could BT to.

Okey dokes, thanks again. I've already done that, i.e. paid off part/kept emergency fund. I don't have any lower APR cards, sadly. I've just managed to have ONE of the banks extend my term by 3 months, though (after 2hrs on the phone). 

How funny (not) that you spend 6 years following all the right steps and then BOOM! you do nothing different but your debt starts to creep up again. Hey ho!

SaraD

phillw said:

SaraD said:
Thanks - I do realise the CRA thing is mostly irrelevant, it was just a bit of extra info. It's easy to say 'pay the debt' but as I said, that leaves me personally at risk if I encounter a domestic emergency or my car finally gives in. This is the point of my query, i.e. is there any OTHER option? But thanks for the reply :-:smile:

You aren't at risk, as long as you can put your emergency bills on your now cleared credit card.

https://www.moneysavingexpert.com/savings/pay-off-debts/

If you keep the savings you'll definitely be carrying an interest bearing balance, if you pay the card off you'll only be paying interest in an emergency.

Borrowing from friends/family or increasing your income are really the only other legal options you have.

Then there are also questions like, if the car conks out then do you actually need a car if you are not working.

Thanks, much appreciated. 

I'm a long-time Martin Lewis fan - in fact, it's thanks to his advice 10 years ago that I even got onto the property ladder and am now mortgage-free. So I fully appreciate his advice to pay off debt if you have savings.

It's just frustrating to have been able to pay off the debt at 0% over 6 years and suddenly no longer be able to. It suited me so well. The car issue is non-negotiable, I have elderly parents 2 hours away who need regular visits/help. 

My 'savings' were intended not only for emergencies but for things like a washing machine and freezer, which I haven't yet bought for the studio flat - saying you are 'mortgage-free' sounds great, doesn't it, but it's not always as it seems! Looks like I'll have to pay off the debt and live in fear of unexpected expenses!

Thanks all :-)

[Deleted User]

Deleted_User said:

Pay down the debt and ignore the credit score. Lenders will assess you in your risk, not the CRA score. 

Low income and revolving debt is a high risk scenario for lenders.

Not exactly the case, while in not on universal credit I do receive other benefits due to the disability I suffer from and have quite descent credit cards from HSBC, Santander ect.

If someone is on UC or other benefits due to a disability, lenders are not allowed to decline the facility on that basis alone as that would amount to unlawful discrimination provided the amount of those benefits would pass their standard affordablity checks.

[Deleted User]

Deleted_User said:

Deleted_User said:

Pay down the debt and ignore the credit score. Lenders will assess you in your risk, not the CRA score. 

Low income and revolving debt is a high risk scenario for lenders.

Not exactly the case, while in not on universal credit I do receive other benefits due to the disability I suffer from and have quite descent credit cards from HSBC, Santander ect.

If someone is on UC or other benefits due to a disability, lenders are not allowed to decline the facility on that basis alone as that would amount to unlawful discrimination provided the amount of those benefits would pass their standard affordablity checks.

Nothing you put corrected what zx81 wrote. He is perfectly correct - low income and revolving debt is a high risk scenario, it doesn't matter whether low income means benefits or someone on minimum wage