We’d like to remind Forumites to please avoid political debate on the Forum.

This is to keep it a safe and useful space for MoneySaving discussions. Threads that are – or become – political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.

📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!

Pay off loans with credit card

I have three banks loans two at 2.5% and one at 8.8%..I also have a decent credit card which offers no interest on cash withdrawals for 30 months.
My question is should I pay off the higher rate loan with the card if that makes sense.
Any advice really appreciated. 

Comments

  • Ebe_Scrooge
    Ebe_Scrooge Posts: 7,320 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    edited 26 January 2022 at 9:00AM
    No interest on cash withdrawals?  Are you sure?
    I suspect you are referring to a "money transfer" offer, whereby money is deposited into your bank account and a corresponding debit is made to your credit card.  If that's the case then yes, it would make sense to take advantage of this.  Bear in mind there will usually be a fee to pay to make the transfer, so you'll need to factor this in to your calculations.
    You must remember though - doing this does not pay off the debt, it merely moves it from one place to another.  You absolutely must have plans in place to make sure the credit card is repaid in full by the time the promotional offer expires.  If you don't, any remaining balance will start to attract interest at the card's standard APR, which is likely to be a great deal higher than the rate you're currently paying on the loans.  You may be able to balance-transfer the remaining balance to another low-rate card offer - but you cannot and must not bank on being able to do so.
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 352.2K Banking & Borrowing
  • 253.6K Reduce Debt & Boost Income
  • 454.3K Spending & Discounts
  • 245.2K Work, Benefits & Business
  • 600.9K Mortgages, Homes & Bills
  • 177.5K Life & Family
  • 259.1K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16K Discuss & Feedback
  • 37.7K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.