Transferring a loan to a 0% Credit card

DBmoney

With a loan that has around 36 months left, is it worth uplifting the loan to a 0% credit card (30 months)?

1. I know that 0% credit card offers will allow transfers between credit cards, but will they allow transfers between a loan company and a 0% credit card?
2. Will a debt on a credit card, rather than a loan effect my credit rating? Do credit rating 'companies' take a dimmer view of debt on a credit card than a loan debt? (especially if you have an excellent credit score).

By doing this transfer, I reckon, after calculating and deducting the credit card transfer fee, I would save around £500 and pay of the debt 6 months earlier by paying the same per month.

Any thoughts.....

Will_Riker

DBmoney said:

With a loan that has around 36 months left, is it worth uplifting the loan to a 0% credit card (30 months)?

1. I know that 0% credit card offers will allow transfers between credit cards, but will they allow transfers between a loan company and a 0% credit card?

Most loans won't accept payment/transfer via a credit card.  Even if they do accept it, it will be treated as a cash advance by the credit card, incurring fees and interest.  You could potentially look into a money transfer card - though there's usually a fee for doing the transfer, and you must make sure you'll be able to repay the credit card in full by the time the promotional rate expires.

DBmoney said:

2. Will a debt on a credit card, rather than a loan effect my credit rating? Do credit rating 'companies' take a dimmer view of debt on a credit card than a loan debt? (especially if you have an excellent credit score).

There will be very little difference.  Opening a new credit card will have a tiny effect on your credit history for a short space of time, but the effect will be negligible.

You can safely ignore your score as it's seen by no-one except the CRA and you.

martinbainbridge1975

you may possibly need to use a money transfer card, worth checking with the loan company to see if they will accept a credit card payment first.

when making payments pay more than any minimum as I am led to believe if you only pay the minimum this is noted on credit files

born_again

Money transfer card.
Transfer amount to bank account, pay loan off.

But you will need to make sure that you will get a card that has a big enough balance to do this. So income to debt available is going to come into play.

DBmoney

Will_Riker said:

Most loans won't accept payment/transfer via a credit card.  Even if they do accept it, it will be treated as a cash advance by the credit card, incurring fees and interest.  You could potentially look into a money transfer card - though there's usually a fee for doing the transfer, and you must make sure you'll be able to repay the credit card in full.....

....I wondered if that might be the case....  I'll take a look at the money transfer card options, but I suspect that might eat into the £500 potential savings....  Thanks for your reply.

martinbainbridge1975

DBmoney said:

Will_Riker said:

Most loans won't accept payment/transfer via a credit card.  Even if they do accept it, it will be treated as a cash advance by the credit card, incurring fees and interest.  You could potentially look into a money transfer card - though there's usually a fee for doing the transfer, and you must make sure you'll be able to repay the credit card in full.....

....I wondered if that might be the case....  I'll take a look at the money transfer card options, but I suspect that might eat into the £500 potential savings....  Thanks for your reply.

money transfer card usually 3-4% fee on the money taken from the card

Alex9384

All money transfer cards I know have a 4% fee and only 12 months of the 0% period.

Has anyone on here seen any better MT offer recently?

I had 4% fee and 24 months on money transfer on Halifax but that was in December 2021. Next month it reduced to 18 months and since then it's been just 12 months. Same with Tesco and Virgin.

cymruchris

Alex9384 said:

All money transfer cards I know have a 4% fee and only 12 months of the 0% period.

Has anyone on here seen any better MT offer recently?

I had 4% fee and 24 months on money transfer on Halifax but that was in December 2021. Next month it reduced to 18 months and since then it's been just 12 months. Same with Tesco and Virgin.

Money transfers (and balance transfers) are tailored to you, your circumstances and the lenders decision as to which 'risk' category they put  you in. Ten customers of the same bank and same credit card could potentially get ten different offers in terms of duration and fee. I have some with a 3% fee - no doubt there'll be others with lower/higher fees than me. Duration wise mine are 12 months.

I imagine that the OP won't get a money transfer card with 0% for 30 months - but if they can pay it off in 12 it could be achievable depending on the value of the loan. That might mean making some sacrifices - but ending up debt free a lot sooner. (They may also not get a suitable limit to cover the value of the loan).

grumbler

Alex9384 said:

All money transfer cards I know have a 4% fee and only 12 months of the 0% period.

Has anyone on here seen any better MT offer recently?

You can do a little better by combining a 0% BT card with an ordinary CC card. Use the latter for a MT for c.3% fee and then transfer the balance to 12 months 0% for c.3% fee.  This gives you 24 12 months for c.3% fee.

Alex9384

cymruchris said:

Money transfers (and balance transfers) are tailored to you, your circumstances and the lenders decision as to which 'risk' category they put  you in. Ten customers of the same bank and same credit card could potentially get ten different offers in terms of duration and fee. I have some with a 3% fee - no doubt there'll be others with lower/higher fees than me. Duration wise mine are 12 months.

Yes, but doesn't this only apply to those who require you to do eligibility check first, only then they show you the offer?

Most banks still advertise publicly what their best offers are. Can you get better than their best offer?

.

Nebulous2

Alex9384 said:

All money transfer cards I know have a 4% fee and only 12 months of the 0% period.

Has anyone on here seen any better MT offer recently?

I had 4% fee and 24 months on money transfer on Halifax but that was in December 2021. Next month it reduced to 18 months and since then it's been just 12 months. Same with Tesco and Virgin.

A long-standing Barclaycard is currently offering me 18 months at 2.6%.