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How to work out what might be cheaper - money transfer from a credit card, or a loan
HelenNoreen
Posts: 48 Forumite
in Loans
My husband wants to borrow £3,000 to cover the cost of a lease extension.
He is trying to compare whether it would be cheaper to do a money transfer from his credit card (currently zero balance) or get a bank loan.
Either way, this value will be included in a re-mortgage in a few months time; so it is only a temporary loan (no other debt other than the mortgage).
The loan is 16.6% interest. With the money transfer (which is available for £2500, not £3,000), can either do 0% and pay a £125 fee. Or no fee, with interest of 6.9%.
How do we work out which is cheaper?? Any ideas??
He is trying to compare whether it would be cheaper to do a money transfer from his credit card (currently zero balance) or get a bank loan.
Either way, this value will be included in a re-mortgage in a few months time; so it is only a temporary loan (no other debt other than the mortgage).
The loan is 16.6% interest. With the money transfer (which is available for £2500, not £3,000), can either do 0% and pay a £125 fee. Or no fee, with interest of 6.9%.
How do we work out which is cheaper?? Any ideas??
0
Comments
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For a short term loan of a few months don’t look at paying a fee for the transfer. That will certainly cost you more.In the other case 6.9% is a lot lower than 16.6%
as long as £2,5k is enough for your purposes1
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