Transferring CC1 cash to current acc then using it to pay off CC2

Strangie

I have two Lloyds credit cards. They both have gone out of their 0% time and also I was getting overwhelmed with the multiple payment dates. I decided to transfer it all (total £8k) to a Santander 0% interest card. I messed up and the Santander card only had a limit of £3k, so I moved some of Lloyds CC1 (leaving £3k in Lloyds CC1) to the new card, but now I'm paying 3 cards which is a headache. So here's my question. Apparently, I can't transfer from one Lloyds card to another Lloyds card and get 0% interest. So would it make sense to do a money transfer from Lloyds CC1 to my Lloyds current account at 0% interest over 12 months with a fee of 4%, then use that to pay off Lloyds CC2? OR... Is this a false economy.

ProcessMatters

You’re thinking along the right lines, but the key question is whether the 4% fee is actually buying you anything.

A money transfer can make sense if it replaces interest you’d otherwise be paying, or if it genuinely simplifies things enough to avoid missed payments. But if CC2 isn’t accruing much interest yet, then paying 4% just to shuffle debt around is effectively paying for convenience.

Before doing it, it’s worth checking:

Whether you can increase the Santander limit or apply for another external 0% BT in a few months

What interest CC2 would actually cost you over the next year vs the one-off 4% fee

If the fee is lower than the interest you’d otherwise pay and you’ll clear it within the 0% window, it’s reasonable. If not, it’s probably a false economy.

born_again

If you plan to pay it off in 12 months yes.

MyRealNameToo

Strangie said:

I have two Lloyds credit cards. They both have gone out of their 0% time and also I was getting overwhelmed with the multiple payment dates. I decided to transfer it all (total £8k) to a Santander 0% interest card. I messed up and the Santander card only had a limit of £3k, so I moved some of Lloyds CC1 (leaving £3k in Lloyds CC1) to the new card, but now I'm paying 3 cards which is a headache. So here's my question. Apparently, I can't transfer from one Lloyds card to another Lloyds card and get 0% interest. So would it make sense to do a money transfer from Lloyds CC1 to my Lloyds current account at 0% interest over 12 months with a fee of 4%, then use that to pay off Lloyds CC2? OR... Is this a false economy.

With some you can even MT off the card with the debt then pay it back onto the card with the interest incurring debt to clear the interest. 

What's the APR on the card? As long as it's over 4% in principle you will be better off doing what you suggest. Ideally you'd want to be able to pay it off in 12 months but it's still better even if you can't and you then hopefully do the same trick again next time. Obviously having another card with a new card BT offer would likely have lower fees than 4% but assume thats a none starter. 

Its actually if you can pay it off in full in a month or so where it wouldnt make sense to pay the 4% fee because that could easily exceed the interest of paying it off without transferring it. 


As to multiple payments... on payday calculate what your bills are in total. Stick that amount in an account that all your DDs come from and dont touch it. Leave the rest in another account that you use for non-DD spending. It doesnt matter if you have 1 big DD or 20 small ones, the right money is there and will be taken without you having to worry about it or have headaches etc. Personally have a spreadsheet with each DD listed, if its fixed or variable and the amount so when payday comes just have to adjust the amount for the few variable DDs and job done.