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Originally Posted by Jo4
My friend has approximately £5,500 of debt on credit cards at a rate of 5.9% pa except for £895.81 which is at a rate of 2.9% pa. They are currently repaying £230 a month, but their payments will increase in September and therefore they will have all the credit card debt repaid by Christmas 2008.
I was wondering since they will pay the debt off in 1 year should they consider applying for a 0% card which has a transfer fee or should they stay with the cards they have? Which is the cheaper option and how do you work it out?
Originally Posted by pyewackett
Online yesterday, for new customers only, saw a BT deal of 2.9% for 24 months with a 2.5% fee [HSBC]
In the post this morning as an existing customer got offered a lousy 5.9% for 6 months! Called up and pulled the loyalty card and they gave me the better deal straight away!
moggles wrote: »
Is s/he really sure they can clear this debt by the end of the year? By my reckoning, they'll need to double their repayments in September, then double that figure again!
If s/he has a good credit history and is in a position to apply for a 0% balance transfer card, I would go for it. Even with a 3% handling fee, the new card would save money over the year.
Have a look at the Minimum Repayments calculator on the main site.(Don't be put off by the name.You can enter more than the bare minimum payment required)
If you play around with the above figures, you'll see it's definitely worthwhile transferring these balances
Q. How much should I pay off each month?
A. As much as you can, even 0% debt is still debt. The more you repay, the faster the debt disappears. Especially important is that you try and pay more than the set minimum. For more on that and tips on how to do it, read the Minimum Repayments: Danger! article.
Originally Posted by deborahwaine
I need to transfer from a card which runs out of 0% interest in March. I have another card due to run out of same in July.
Do I transfer card one to card two, then wait till June to find another 0%?
... or transfer card one next month, then card two as the interest free period runs out? Which will be the cheaper method?
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