Some more advice please.

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Im trying to find ways of clearing my overdraft and having a complete re organisation of my spending!
Firstly I have an overdraft limit of £3500, which I have reached. I have about £2000 on credit card. Ive done a budget planner which shows that I should be in credit each month, but recent overspending has obviously taken me way overdrawn. Im very aware that I need to cut costs and change my spending habits, I think I know how Ive been 'wasting' money and am willing to change my ways!
So, Ive been reading about credit cards and 'super balance transfers'. Would this be beneficial to me? How can I clear my overdraft with a credit card? Im a complete novice when it comes to credit cards, so please give it to me gently and simply ;)
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  • YorkshireBoy
    YorkshireBoy Posts: 31,541 Forumite
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    louise1 wrote:
    So, Ive been reading about credit cards and 'super balance transfers'. Would this be beneficial to me? How can I clear my overdraft with a credit card? Im a complete novice when it comes to credit cards, so please give it to me gently and simply ;)
    You will need a card which allows balance transfers from a current account, MBNA (esp. Virgin) and Egg do this.

    Read the "super balance transfer" and "best balance transfer" articles - accessed through the yellow "credit cards" box to left of this screen.

    There is also some information on https://www.stoozing.com although not all of it may be relevant.

    Post back with any specific questions you have.
  • louise1_3
    louise1_3 Posts: 28 Forumite
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    Thanks, so once I transfer the overdraft to the credit card I then pay that credit card monthly untill the debt has gone? I need to know how much the monthly repayments will be though, before applying to do this.
  • YorkshireBoy
    YorkshireBoy Posts: 31,541 Forumite
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    Something for you to consider...

    I'm asssuming your current credit card is not from the MBNA stable?

    1. Apply for Virgin card, and request £5,500 BT from your current account - you should not be charged a BT fee for this.

    2. Pay off your existing credit card debt of £2,000 from your current account funds.

    3. Your Virgin repayments are £5/month. Now this is the crucial part - PAY MORE THAN THIS. Otherwise you will be in MASSIVE debt in 9 months time when the Virgin deal ends - even more so than you are now!

    4. DO NOT MAKE ANY PURCHASES ON THE VIRGIN CARD. It is a BT card only and purchases attract 15.9%.

    5. Make "essential" purchases on your existing card, always paying off in full each month.

    6. Line up another 0% BT card 6-8 weeks before the Virgin deal ends, and transfer the REMAINING debt from Virgin.

    7. You need to have DISCIPLINE to make this work.

    A few questions...

    1. Who is your existing credit card with?
    2. How much can you afford to pay each month?
    3. Is your salary/credit history good?
  • louise1_3
    louise1_3 Posts: 28 Forumite
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    That sounds good to me!

    My credit card is a master card.
    I think I could afford about £80 a month to pay it off.(I was looking at taking out a personal loan to pay off my debts and realised this is the amount I could afford monthly).
    As far as I know my credit history is good.
  • YorkshireBoy
    YorkshireBoy Posts: 31,541 Forumite
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    louise1 wrote:
    My credit card is a master card.
    Which company provides it, eg Lloyds, Natwest etc?
    louise1 wrote:
    I think I could afford about £80 a month to pay it off.
    This is not so good! After 8 months, you will only have paid £640 (or 11%) off your debt. At this rate, it's going to take you a long time, and many 0% deals, to clear the debt without finding extra money from somewhere. Maybe a LOB deal will be better for you?
    louise1 wrote:
    As far as I know my credit history is good.
    I'm making a rather sweeping statement here, but if you only have £80 a month spare you may not be given a credit limit large enough by a new card supplier.
  • louise1_3
    louise1_3 Posts: 28 Forumite
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    :(

    Sorry to sound dumb, but what does LOB stand for?
  • Ember999
    Ember999 Posts: 1,022 Forumite
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    louise1 wrote:
    :(

    Sorry to sound dumb, but what does LOB stand for?

    A 'LIFE OF BALANCE' card......for eg. Captial One fixed LOB 5.9 % etc....(that's not an actual offer, just an example to show you) :p Means that interest rate is fixed until you pay off the amount.
    ~What you send out comes back to thee thricefold!~
    ~
  • louise1_3
    louise1_3 Posts: 28 Forumite
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    But can I still do a 'SBT' with a LOB card?
  • louise1_3
    louise1_3 Posts: 28 Forumite
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    Can anyone tell me if a SBT is possible with a LOB card please? Texaco doesn't offer this.
  • johannamse
    johannamse Posts: 498 Forumite
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    Hi Louise,

    Yes it is possible to do a SBT from a LOB card, BUT you have to do it via another card, normally Egg. So you transfer x amount to your egg card and then transfer the positive balance to your current account.

    Please be aware that not all credit cards have £5 as the minimum payment. Mostley thet are 2-3%, so please read the terms and conditions before you do any applications. On a 5500 debt this could be a monthly payment of £165!

    Are you sure you can only afford £80 per month. Have you cut back - why not post your outgoings on here? Could you get a second job?
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