End of Interest Free period....what next?

Shinds

Hi all,

I would like to know what would be one's options when say for example their Egg card's interest free period is coming to an end.

If you had 10k stoozed - and balance transfered this to a new 0% card, you'd obviously have to pay the min monthky payments back.. but then say if this new card is not like Egg and doesn't allow you to credit that min monthly payment back into ur current account??

What can one do???

Thanks.

Martinslovechild

Shinds

If I've understood you correctly:-

1. Apply for new card (e.g. MBNA)
2. BT from Egg to MBNA (even though Egg has £0 balance)
3. MBNA now shows £10000 balance
4. Egg now shows £10000 CREDIT balance
5. Transfer the £10000 to your current account

I'm not quite sure what you mean about crediting the minimum monthly payment back into your current account - can you expand on that point?

MLC

nh

What we do is always have some of the 0% money kept in a regular current account (not our normal current account, one that is used just for stoozing) to pay the minimum payment each month. eg. We have £17,000 borrowed at 0%: £12,000 in ISAs and £5,000 in the current account to meet the minimum payments and also to borrow from as a short-term measure. I know I should probably have more of the £5k in a savings account but I have too many accounts as it is - it is easier this way and it is earning 2% at FD anyway.

I don't know of any way you can borrow £10k, have it all sitting in a high-interest account, make the minimum payments and keep returning those minimum payments into the high-interest account - if that is what you are asking...

bethyblue612

nh
If you're keeping £5k in a current account, why not keep it in an Alliance & Leicester CA at 5.5% ? I know you said you've got too many accounts, but if the FD one is just for stoozing, then close it if you go for A&L.

smartsaver

If new card IS an MBNA based card then no problem as you only have to pay £5.00 per month I should think even the poorist stoozer can afford that.

Other wise do as already mentioned take out of stoozed money.

All sorts of variables can be played with depending on the card...

deemy2004

MBNA can go straight to your current account.

Unbelievable_2

shinds

You could transfer the paid back balance to your Egg card, creating a credit balance and then SBT it to your current account. However... there is a HUGE debate on the credit card discussion thread about the legality/morality of such a technique ::)

Milarky

nh
If you're keeping £5k in a current account, why not keep it in an Alliance & Leicester CA at 5.5% ?

This account only pays 5.5% on balances upto £2500 - although you can put the rest in a linked A&L online savings account at about 5.35% [I think]

FD savings account can be linked to FD current a/c and pays 3.25% [better than 2% at least!] and you can post date the transfer requests so that they move into the current a/c on the same day the min payment goes out. But I agree, there are many better bank account on interest rates available

MarkyMarkD

You have to pay in £1,000 a month to qualify for the 5.5% A&L account. Best used as a primary account, not as a stoozing funding account IMHO.

But you can make online same day transfers to the linked 5.35% account you mention - I do it often

Shinds

Shinds

If I've understood you correctly:-

1. Apply for new card (e.g. MBNA)
2. BT from Egg to MBNA (even though Egg has £0 balance)
3. MBNA now shows £10000 balance
4. Egg now shows £10000 CREDIT balance
5. Transfer the £10000 to your current account

I'm not quite sure what you mean about crediting the minimum monthly payment back into your current account - can you expand on that point?

MLC

Hi MLC,

What I mean is what Unbelievable has written....

I have 10k from an Egg card in an account. Now what I've been told by many people is.... When I make that min' monthly payment to Egg (Say 2% which = £200) - That will in affect leave a balance on £9800 on my Egg Card. And because I have a 10K limit - I could infact  SBT that £200 back into my current account.

So basically - I get my money back

Shinds

shinds

You could transfer the paid back balance to your Egg card, creating a credit balance and then SBT it to your current account. However... there is a HUGE debate on the credit card discussion thread about the legality/morality of such a technique  ::)

So is it actually illegal?? ???