What would you do?

CleverFable

Hi,

I was hoping some one smart about credit cards may be able to help me!

I am currently selling my flat and there is a Section 20 for works on it. I will be covering this bill, putting the amount into a retainer to be used when the work is done. The original full quote was quite high and after contesting the leaseholders have managed to get some of the works removed, which would lower the cost. However the management company are currently ignoring any attempt to get this new cost written as a formal quote (they're ignoring me completely!) So I will have to cover the old, full amount at the moment.

I am covering this with some savings and some money borrowed from some very kind family members. There is however a fairly big chunk that still needs to be covered (£6000).

I have a 0% purchase and balance transfer credit card which I was planning on using for money transfer for this, but I'm not sure if this is the best option? I am going to call the bank and see what the monthly repayments would look like but does anyone have experience of this and what it roughly could be?
My 0% does run out in November so I would have to get a new 0% BT to transfer it to. I think the APR is around 22%.

Or do I get a new 0% Money transfer card? Again not sure on monthly repayments but the 0% would last longer before I had to transfer. I had quick look and I could get an MBNA 0% MT card (0% for 14 months) however this would be max £5000 so I'd need to transfer £1000 from my old CC, so it gets a bit messy. 

I don't think a loan would work in these circumstances?

I absolutely do not mind having to pay off some a month, as it will could be that I have to pay the whole amount off if the works cost that much - it's just trying to keep those payments to a minimum.

Annoyingly, I could get the "new" quote within a month or so of moving, so I wouldn't have to pay too much towards it as I could get the money back and repay the card straight away or, equally, I could have to wait until the work has been finished and invoiced. Which could be at least a year 🤦🏼‍♀️ it is a nightmare!

If you made sense of that, well done! Any help is much appreciated

CleverFable

To add, the quote has gone from a cost for replacing windows in 36 flats, plus 24 shed doors, 15 fire doors and 36 front doors and 3 communal windows to just 6 flats and the 3 communal windows. So a rather large drop, just frustrating that they can't seem to get a new quote to us!

MorningcoffeeIV

The monthly payment will be whatever is specified in the terms 

Typically 1% plus fees and interest.

CliveOfIndia

CleverFable said:

I have a 0% purchase and balance transfer credit card which I was planning on using for money transfer

You won't be able to do a MT on that card, unless you also have a specific MT offer available on it - MT is different to BT.  Even then, you'd need to read the T&Cs carefully to see how payments are allocated if you already have a balance on the card.

CleverFable said:

My 0% does run out in November so I would have to get a new 0% BT to transfer it to.

Be aware that in the current economic climate, lenders are tightening their belts.  Hopefully you will be able to get another 0% BT transfer offer, but it would be unwise to just assume that you'll be able to - you need a backup plan to clear the balance if you can't transfer it.

CleverFable said:

I don't think a loan would work in these circumstances?

I don't see why not.  And it might be the cleanest solution.  OK, it won't be at 0% interest, but I see no reason why you couldn't get a loan for this (assuming you meet the lender's usual requirements for income, current debt levels, etc. etc.)

Alternatively, do you currently have a mortgage on the property?  If so, you may be able to get a further advance on the mortgage, use that to pay for the works?  Obviously this means increasing your secured debt which brings its own potential risks, but it may be an option to look at.

On that note, if you're going to be taking out a new mortgage when you move, just remember that any new debt you take on (whether credit card, personal loan, whatever) will be factored into the lender's affordability checks.  This may or may not be an issue for you, depending on your financial circumstances and the sums involved, but it's just something to be aware of.

CleverFable

Thanks for your response. I'm reluctant to take out a loan purely because of the new mortgage going in. I would have to take out the loan before exchange and completion and I don't want this to effect the mortgage.
I will have to wait until we have moved to start applying for any new cards too. So after doing a bit more research after posting this it looks like I will have to transfer money from my current credit card (with a large first payment with interest etc - I have asked if I can do MT using my current card and I can, just with interest) and get a 0% balance transfer card soon after moving to transfer the balance to. I have no balance on my credit card at the moment and never use it, it's for emergencies really. 
I had a quick look and there are a few BT cards I would be eligible for so fingers crossed this could be a plan. I can afford the repayments if not, and could pay off chunks as I go, I just don't have the full amount in one go. It would just be better to do it without any interest!
 
I don't want to increase the mortgage or add any to it as I am not sure what the final bill will be so I don't want to add a random amount and increase repayments for no real reason. 

It's such a massive pain that I cannot get a new quote from the management company as it would likely save a lot of this issue, I will be attempting to make contact again today. 

daivid

The CC option will also be picked up on your mortgage application. If your affordability and credit rating is good then it won’t matter, if you are borderline it could be very significant, unfortunately there may be no way of knowing in advance and it seems you need to pay this bill somehow before you can move.

If you are determined to go down the CC route I'd try for the BT card first as November isn’t long, especially if fees have to be payed. Look at Natwest (or sister banks RBS & Ulster) they will tell you the likely limit as part of the eligibility check (no hard search). If you have a promising BT option then look at MT options looking at your existing cards and their MT offers would be a good start. Halifax and MBNA have given me no fee 6.8/6.9% APR MT on existing cards, by getting the BT in advance then MT and BT straight away from the MT card I've been able to keep interest to a minimum (£1.20 on a £6.2k MT). You also need to check the BT card will take a balance from the other card - if they belong to the same banking group they will not and this isn’t always obvious.

CleverFable

Thank you. It is getting quite stressful with what I can and cannot do! 

The mortgage offer is in place and ready to go, but I really don't want to do anything to interrupt this as it's taken a long time to get to the point of near moving. I think I might talk to my solicitor and see if I can put half in a retainer now and the rest after we move, just so I don't effect the mortgage. 

The bill technically does not need to be paid yet as no work has been done, I just need to show I can cover it so the buyers don't have to. I have emailed the management company again today to try and get a new quote but chances are they will ignore me again!

backinbusiness

I would add that if you wait until you move to apply for new credit then the recent move may in fact impact on your ability to borrow more.  Lenders like stability.