Debt Consolidation vs Credit Cards? Credit Utilisation question!
Hi all,
A quick question. I've been paying off my debts for over a year now and haven't missed a payment in over 12 months, for the first time in 5 years! I've been offered a debt consolidation loan which would cover off 2 of my higher-interest credit cards. I accepted one amount however I'm now thinking that perhaps I should have taken a higher offer (£7,000 instead of £5,000) to further clear another balance (of the same interest as the loan) and potentially lower my credit utilisation.
The question is, do loans count towards the overall credit utilisation as much as the credit cards?
Thanks!
A quick question. I've been paying off my debts for over a year now and haven't missed a payment in over 12 months, for the first time in 5 years! I've been offered a debt consolidation loan which would cover off 2 of my higher-interest credit cards. I accepted one amount however I'm now thinking that perhaps I should have taken a higher offer (£7,000 instead of £5,000) to further clear another balance (of the same interest as the loan) and potentially lower my credit utilisation.
The question is, do loans count towards the overall credit utilisation as much as the credit cards?
Thanks!
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Replies
You could try calling the provider of the now-empty card and asking if they have any 0% periods or low-life of balance transfers available. If they offer a significantly better rate than the other card (including transfer fees etc) then you could move that money to a lower rate.
If they say no, close the account and cut up the card so you can't run it up again. Trust me, it's way too easy to creep up and a lot of us on here have done it (I did it twice).
LB moment - March 2006. DFD - 1 June 2012!!! DEBT FREE!
May grocery challenge £45.61/£120