0% credit cards

Beginner_Budgeter

CliveOfIndia said:

Beginner_Budgeter said:

CliveOfIndia said:

One thing to be careful of.  If you do attempt to pay off the debt by using a 0% purchase credit card, you may well find that the transaction is classed as a cash advance rather than a purchase.  As such, it wouldn't qualify for the 0% rate, you'd likely be charged interest on it, and probably a cash advance fee as well.

If you decide to go for the balance transfer option, check whether this would be allowed - is the debt with Creation a credit card or a loan?  If it's a credit card then you'll probably be fine, but if it's a personal loan you can't usually do a balance transfer to pay it off.

I'm not saying either of these things are for certain - just make sure you read (and understand!) the T&Cs of your 0% card very carefully.

The debt is with Creation via a Currys YourPlan account so I'm not sure what it would be classified as.

This is the reason I've been a little bit hesitant in terms of applying for a card because I'm not sure what banner it would be under and the last thing I want to do is create a worse situation financially.

It would depend to some extent on what card you applied for, but most - actually, probably all, but I can't 100% guarantee that - cards would class paying off finance as a cash advance, which would cost you dear. 

The other option you could look into is a Money Transfer card.  This will transfer cash into your current account and put a corresponding debt on the credit card, which will charge interest at a low rate (possibly 0% if you're very lucky!).  You use the cash in your current account to repay the original debt, then repay the credit card bit by bit - though you do need to make sure you'll be able to repay it in full by the time the promotional rate expires.  Otherwise any remaining balance will start to attract interest at the card's standard APR, which will be pretty high.

You may be able to transfer any remaining balance to another 0% card, but it would be extremely unwise to bank on being able to do so.

Be aware there is usually a fee for doing a MT, but overall it can often be worthwhile for what you save by paying lower (or no) interest compared to the existing debt.

So I've taken a look into a few options for a MT card and there is one which says I'm pre approved for a 14 month 0%. Calculating the cost of debt over 14 months would lower my current bill by around £30-£40 whilst reducing the overall pay time from around 30 months to 14 months. Assuming that I'm accepted this is possibly the best route to go down?

CliveOfIndia

Beginner_Budgeter said:

CliveOfIndia said:

Beginner_Budgeter said:

CliveOfIndia said:

One thing to be careful of.  If you do attempt to pay off the debt by using a 0% purchase credit card, you may well find that the transaction is classed as a cash advance rather than a purchase.  As such, it wouldn't qualify for the 0% rate, you'd likely be charged interest on it, and probably a cash advance fee as well.

If you decide to go for the balance transfer option, check whether this would be allowed - is the debt with Creation a credit card or a loan?  If it's a credit card then you'll probably be fine, but if it's a personal loan you can't usually do a balance transfer to pay it off.

I'm not saying either of these things are for certain - just make sure you read (and understand!) the T&Cs of your 0% card very carefully.

The debt is with Creation via a Currys YourPlan account so I'm not sure what it would be classified as.

This is the reason I've been a little bit hesitant in terms of applying for a card because I'm not sure what banner it would be under and the last thing I want to do is create a worse situation financially.

It would depend to some extent on what card you applied for, but most - actually, probably all, but I can't 100% guarantee that - cards would class paying off finance as a cash advance, which would cost you dear. 

The other option you could look into is a Money Transfer card.  This will transfer cash into your current account and put a corresponding debt on the credit card, which will charge interest at a low rate (possibly 0% if you're very lucky!).  You use the cash in your current account to repay the original debt, then repay the credit card bit by bit - though you do need to make sure you'll be able to repay it in full by the time the promotional rate expires.  Otherwise any remaining balance will start to attract interest at the card's standard APR, which will be pretty high.

You may be able to transfer any remaining balance to another 0% card, but it would be extremely unwise to bank on being able to do so.

Be aware there is usually a fee for doing a MT, but overall it can often be worthwhile for what you save by paying lower (or no) interest compared to the existing debt.

So I've taken a look into a few options for a MT card and there is one which says I'm pre approved for a 14 month 0%. Calculating the cost of debt over 14 months would lower my current bill by around £30-£40 whilst reducing the overall pay time from around 30 months to 14 months. Assuming that I'm accepted this is possibly the best route to go down?

Sounds promising.  Bear in mind that the pre-approval is only an indication, you won't know for certain until you apply.  And the rate/duration you actually get offered may be different when your application is approved.  Also you'll need to factor in the fee (it's fairly unusual to find a fee-free MT card).

But yes, all things being equal it sounds like a result.

I'll reiterate - please do make sure you'll be able to clear the card in full before the 14 months are up

daivid

Beginner_Budgeter said:

grumbler said:

You cannot pay off one CC with another CC. So, you need a CC offering 0% on balance transfers. Expect to pay about 3% for the BT if you manage to get such card.
Cards offering 0% on purchases are easier to get, but for you the only way of taking advantage of it is to use it for your essential spending and to direct the 'saved' money towards your old CC.

So just to confirm, even though it is not a physical card it would still be classed as a credit card. So using the card and inputting the information on the app/their website would not work? They do state that you can pay through a bank transfer and give their sort code and account number on their website, as well as saying they accept Mastercard and Visa credit cards as a form of payment. I would post links to the correct website pages but it won't allow me yet.

OP is your debt with Creation Finance a loan or a Credit Card? 

grumbler

Beginner_Budgeter said:

grumbler said:

You cannot pay off one CC with another CC. So, you need a CC offering 0% on balance transfers. Expect to pay about 3% for the BT if you manage to get such card.
Cards offering 0% on purchases are easier to get, but for you the only way of taking advantage of it is to use it for your essential spending and to direct the 'saved' money towards your old CC.

So just to confirm, even though it is not a physical card it would still be classed as a credit card. So using the card and inputting the information on the app/their website would not work? They do state that you can pay through a bank transfer and give their sort code and account number on their website, as well as saying they accept Mastercard and Visa credit cards as a form of payment. I would post links to the correct website pages but it won't allow me yet.

TBH, I'm not sure now. I didn't read the OP carefully enough and thought it was Creation CC, not 'finance'. If they take CC payments, you can try a purchases 0% card, but as others said, there is risk that it'll be treated like cash advance, not a purchase.

The only 100% reliable way is a card offering 0% on money transfers (see the same MSE article).

Beginner_Budgeter

daivid said:

Beginner_Budgeter said:

grumbler said:

You cannot pay off one CC with another CC. So, you need a CC offering 0% on balance transfers. Expect to pay about 3% for the BT if you manage to get such card.
Cards offering 0% on purchases are easier to get, but for you the only way of taking advantage of it is to use it for your essential spending and to direct the 'saved' money towards your old CC.

So just to confirm, even though it is not a physical card it would still be classed as a credit card. So using the card and inputting the information on the app/their website would not work? They do state that you can pay through a bank transfer and give their sort code and account number on their website, as well as saying they accept Mastercard and Visa credit cards as a form of payment. I would post links to the correct website pages but it won't allow me yet.

OP is your debt with Creation Finance a loan or a Credit Card? 

I believe it to be a Loan rather than a Credit Card. It would be through a Currys YourPlan account (buy now pay later) 

Beginner_Budgeter

grumbler said:

Beginner_Budgeter said:

grumbler said:

You cannot pay off one CC with another CC. So, you need a CC offering 0% on balance transfers. Expect to pay about 3% for the BT if you manage to get such card.
Cards offering 0% on purchases are easier to get, but for you the only way of taking advantage of it is to use it for your essential spending and to direct the 'saved' money towards your old CC.

So just to confirm, even though it is not a physical card it would still be classed as a credit card. So using the card and inputting the information on the app/their website would not work? They do state that you can pay through a bank transfer and give their sort code and account number on their website, as well as saying they accept Mastercard and Visa credit cards as a form of payment. I would post links to the correct website pages but it won't allow me yet.

TBH, I'm not sure now. I didn't read the OP carefully enough and thought it was Creation CC, not 'finance'. If they take CC payments, you can try a purchases 0% card, but as others said, there is risk that it'll be treated like cash advance, not a purchase.

The only 100% reliable way is a card offering 0% on money transfers (see the same MSE article).

I'll probably go with the money transfer option as it's a bit more secure, it still reduces the amount that I'm paying per month as well as reducing how long I'll be paying it off as well. Appreciate you coming back and double checking though!