Loan vs Credit Cards

Jennieh56

Hi all

I have a loan with a 2.9% interest rate and 2 credit cards on 0% I am looking at selling my car to pay off some of these which one should I do first?

Thanks

Grumpelstiltskin

When does the 0% run out and is there any penalty for paying loan off early?

Jennieh56

The 0% runs out Dec 2023 and no penalty for paying the loan off early.

Grumpelstiltskin

Jennieh56 said:

The 0% runs out Dec 2023 and no penalty for paying the loan off early.

In that case it looks like paying the loan off first and then any balance plus if needed what you are paying now on the loan to clear the 0% before it runs out.

Don't leave yourself short over the next few months because of cost of living increases.  You don't want to find yourself using the credit card again.

fatbelly

Your debts are already at very low interest.

How much cash is coming from the car sale?

I'd consider investing it for 12 months. These accounts pay 5% on up to 5k for 12 months

https://www.moneysavingexpert.com/banking/compare-best-bank-accounts/#interest

Jennieh56

Hi

Thanks, the car sale is approx 13k which is approx what I still owe on the loan.

fatbelly

The easy option then is to pay off the loan, as long as you can be sure you won't need to borrow again in the next 12 months

Jennieh56

I maybe looking for a better mortgage fixed deal within the next 12 months though!