Mistakenly in Applying for Credit Card to Pay Off Paypal Credit - Some Questions

parkview51

Hi,

I am trying to get my finances in order before hopefully buying a house next year. This morning, my credit rating was listed as 'Fair'. I just applied for a 0% interest balance transfer for 20 months credit card with Barclays via Credit Karma, and requested a £1900 limit. I was approved and given a (terrifying!) £6500 limit. The purpose of this card was never to spend, but to pay off approximately £1800 debt I have with Paypal Credit, without accruing further interest. However, when I went to find out how to transfer my balance with Paypal to the Barclay's credit card, I read it's not possible because the Paypal debt is not assigned to a physical card.

I am now wondering if I should have tried to get a low-interest loan instead. I have the following questions:

• Will it be damaging to my credit rating to now go ahead and apply for a loan on top of the (huge limit!) credit card I just got? 
• If I cancel the card with Barclays soon, can I 'undo' any damage done by the credit check made for the card today, and then apply for a loan with a 'clean slate'? 
• Finally, Credit Karma are telling me it is in my interest to have a higher credit limit but not actually use it; is there therefore any merit in me keeping the Barclays card but chopping it up and never using it? If I did this, I am not sure I'd be eligible for a loan as well.

Any advice gratefully received. I have autism and ADHD and often find finances difficult and confusing. Thanks in advance!

km1500

you could investigate a 0% money transfer card (not balance transfer) - money to your bank account use it to.pay Paypal

cymruchris

What Barclaycard did you choose? If it wasn't the 'Forward' credit building card, you may find that once your app is up and running, if you go to the app - tap more on the bottom right, then cards, then tap the photo of your card, scroll down to 'transfers and offers' and see if there's anything in there for a money transfer option (you might have to swipe left).

Barclaycard do have money transfers often - but it may be that as a new card they won't offer it yet - but if it's there, you can transfer money to your current account (usually for a percentage fee) and then get an interest free period to pay the balance down.

There are other money transfer cards on the market as well - but they can be a bit harder to get depending on your credit history.

Volcane

The hard search is done as you applied for the card, there,s no way of removing this now. It will drop off your CRA record(s) after 12 months. A single search is unlikely to have any impact.

parkview51

Thanks, I didn't know about money transfer cards, but I am going to speak to Barclaycard and see if this is an option for me. All the personal loans Kredit Karma are saying I may be eligible for have hefty interest rates, more than what I am paying with Paypal, so it looks like that won't be an option anyway. Thanks for your help, fingers crossed I can get it sorted. Does anyone know if there is any merit for my credit rating in me keeping the Barclaycard and not spending any money on it please? Or should I cancel it if they can't offer me the money transfer thing? 

cymruchris

I’ve mentioned where to find the money transfer options if they’re available - speaking to them will likely point you to where I’ve already pointed you. It’s mainly an automated process rather than a manual one these days. Have you looked to see if there’s an offer available ? 

You don’t have a credit rating - only a credit history. Opening then immediately closing a card can have a negative impact on your history. Now you have it - it’s better to keep it. 

inthezeroroom

The real question is how quickly can you pay off the £1,800 Paypal debt? Shifting it to a credit card via a money transfer (if available) isn't the same as paying it off. I'd forget about credit cards, loans and balance transfers, and focus on paying off the £1,800 by whatever means. If it's your only debt then you should be finished pretty quickly.

fergie_

If barclaycard don't offer you any money transfer offers, you could look at applying for another card that does offer that function. It will mean 2 hard searches close together though which will take 6 months to a year to drop off.

I also wouldn't close the other account - you may even find it useful.

Rajix

Go for a 0% money transfer offer, probably best way...

cymruchris

Rajix said:

Go for a 0% money transfer offer, probably best way...

Not everyone qualifies for one though. A good suggestion if someone has the option open to them.

Hoenir

parkview51 said:

I am trying to get my finances in order before hopefully buying a house next year. 

Redirect what you are saving every month into clearing the debt quicker.