better to switch to lower apr?

donsaini

i currently owe £9500 on halifax mastercard platinum @ 5.95%, min repayment 2%. i repay approx £250 per month. life time balance rate rate

halifax have just sent me a cheques for my visa card with them, £15000 limit. they state life time balance rate of 4.95%, however with 2% BT fee.

would it be better to pay the cheque into my current account, pay off MC, repay £250 on the visa.

2% would be almost £200.

any ideas?

thanx
al

Rafter

Just done the sums and think you would be worse off by about £40 from doing the transfer and paying the fee, despite the interest saving you would make.

You might also find that using the cheque for repaying another Halifax product may be prohibited.

However, if you have more expensive borrowing elsewhere it may be worth using the cheque for that?

Based on a loan of £9500 repaying £250 a month with 4.95% interest plus a 2% fee, the equivalent APR is 6.15% over 3.5 years.

So if you have any debts with an APR greater than 6.15% (without significant early repayment penalties) then you may be better off using your cheque.

Good luck.

R.

MarkyMarkD

Rafter wrote:

You might also find that using the cheque for repaying another Halifax product may be prohibited.

That's why the OP said they would pay the Halifax cheque into their current account and THEN pay off the other Halifax card. You are quite right that you can't do it directly to another Halifax account.

mountainofdebt

Just one thought ...is there a maximum charge on using the cheques?