The 4 Credit Card Shuffle Conundrum

crazy_in_debt

Ok first of all thanks to all you people on here who have helped me over the past 8 months with lots of money saving. I have been reading for a while but just registered now as I need help with a query.

I have multiple debts and need to do something about them. I will do a SOA later but for now I have a pressing query on my credit cards as I have one large balance on a 0% deal which is about to run out. I have a number of cards all with balances and I want to do some moving around the cards I have (don’t think I’ll be accepted for any new ones) to help start getting the balances down and save some interest. So this is my (pretty dire) situation:

Lloyds CC

Balance £9,497 (currently on 0% until 06/04/08)
Credit limit £12,000
(Normal APR 19.9%):eek:

HBOS CC 1

Balance £4,454
Credit Limit £4,700
APR 13.9%

HBOS CC 2 - (I intend to pay this off this week to give 1 clear card)

Balance £93
Credit limit £7,500
APR 12.9%

HSBC CC

Balance £2,375
Credit Limit £7,500
APR 15.9%


I currently have Credit card cheques from Lloyds (0% BT for 6 months – 3% fee) which expire at the end of April, and cheques for both of my HBOS cards (0% BT for 6 months – 3% fee or LOB transfer @6.9% - 3% fee) which both expire at the end of March.

I mention the cheques as they are offers on the table so to speak and can be used. My problem is I don’t know how long it takes to show a clear balance before transferring, and how long balance transfers take to clear so that I can start to shuffle, and also can’t get my head around what to do for best (0% for 6 months knowing full well I can’t pay it off, or LOB @6.9% as it’s better than trying for another loan) and so on?

Now the one thing I do know is that I can’t do any transfers between the two HBOS cards directly. But that’s about it as far as knowing what to do next.

Could I withdraw cash from one card to the sum of one of the cards to pay off another and save a fee, and then transfer the balance from that card before the cash withdrawal interest hits or is that impossible or simply madness?

I know it’s a messy one but wondered if anyone on here with more knowledge could offer a suggestion?

Thanks for reading,
Crazy_in_Debt

Toastie

Transfer your HSBC card to your HBOS CC 2 (not 1) once you have paid that £93. The close the HSBC card.

Then i would look at getting a Long Balance Transfer Card, Virgin maybe? That way you can transfer your LTSB debt on it, or atleast some of it.

The you need to pay off the highest interest card (which will be LTSB or HBOS) whilst keeping the other cards just above the minimum repayment, however the balance transfered card can be paid at the minimum only because it earns no interest.

Then look at changing cards after 6months to get another balance transfer to lower you payments again.

GeorgeUK

I think you need to wait until you receive a statement that says your balance and interest payment is £0 before you can do the transfer. Not sure what the statement dates are, but that may be a little tight.

If you think your credit history is ok, i'd suggest trying for that virgin card and transfer as much of the Lloyds balance as possible. 3 credit checks in 6 months is usually ok before your credit score is affected.

Don't withdraw cash - there is usually a fee for cash withdrawals so you will not be saving anything. Don't try to get a loan. You're better off paying a few months of CC interest rather than getting tied in to a loan. Just transfer to 0% when possible.

Are you managing the current payments ok, or is it tight? If you are really struggling it may be better to talk to one of the free debt charities.

Purple_Peril

As Toastie says, transfer your HSBC balance to you HBOS(2) card. When you ring HSBC to close your account see if they can make you any offers to keep you as a customer - they are currently offering 2.9% on transfers for two year to new customers - if they could offer you that to keep you then you could transfer a good chunck of your LTSB balance at the low rate. But if they won't offer you that deal (or even anything approaching it) then close the account and try elsewhere - but it would be worth asking them how long it would be before you could apply as a 'new' customer).

crazy_in_debt

Thanks for all your replies above!!

GeorgeUK - you say that I need to wait until my next statement to make sure the balance is NIL but that will mean waiting until next month and then I will not have the 0% cheques to use. I suppose I can then phone and threaten to cancel that also and see what they offer?

I don't honestly know what my credit score is like. I have not applied for anything in the past 6 months but I have a lot of credit (couple of loans to add to the 4 cards) and the last time I tried to get a long LOB card (Sainsburys CC last year), they accepted me but only gave a £1k limit which was no good to me.

I am managing to pay my minimum payments and have never missed a payment on the cards or anything else for that matter, it has however got very tight and I have found myself living off the credit card for food shopping this month so that will only get worse (as the balance increases).

Would an online balance check showing NIL balance be enough for me to transfer another balance or is it vital to get the paper version?

Thanks again,
Crazy

CannyJock

Definitely check out the free credit report from Experian - if you've got a history of cards and loans then you'll be able to check that you don't have any old cards still on your file that you don't know about.

You mentioned the 1000 LOB card as being no use, but I'd say that every little helps

Basic snowballing approach (great calculator at www.whatsthecost.com) is to pay the minimum that you need to on the lowest APR debt and divert all possible funds to paying the highest APR debts.

Steps I'd say would be:
1. Pay £ 93 to clear HBOS 2 card
2. Phone HSBC and ask them for a fee-free, low APR BT deal (nothing to lose) to move the HBOS 1 debt onto your HSBC. This will leave both HBOS cards clear.
3. Phone HBOS and ask them if they can (a) move "some or all of "the credit limit from HBOS1 to HBOS2 card - MBNA have been known to do this in the past (b) offer you a fee-free, low APR BT deal on the HBOS 2 card and move the Lloyds TSB balance entirely onto the HBOS cards just before the 0% period runs out to avoid that 19.9% rate.
4. Keep the TSB card once clear and follow the steps in this article to try and negotiate an "extension" to the deal www.makesenseofmoney.co.uk/a_extend.hmtl - it's written by Clariman who is a credit card juggling jedi. If they won't play ball then cancel the card as that APR on it is too high and it'll possibly clear up some available credit.

Hope that helps. Keep the thread updated to let us know how you get on.

crazy_in_debt

Thanks CannyJock!

I will have a read of the links you gave and then start some shifting around. I will certainly post back here when I have done it (or if I get stuck!!)

Thanks again all:beer:

crazy_in_debt

Hi all,

Sorry to say but shortly after my last post my fiance found out she was losing her job and so my priorities changed for a while:rolleyes:

Anyway things are getting back to normal again and she has another job offer already so panic over and I now need to get back to my debts!

I have just made a payment to clear HBOS card 2. I have been told it will not be clear through the BACS system until next Wednesday. I then asked what deal they can do me and he informed me they can do me a LOB at 6.9% with 3% fee. I know that's not exactly the best but I'm not in much of a bargaining position at the moment. Anyway I asked how long it will take to show the balance as NIL before I can then do a BT and he said I can do it today because it takes 10 days to process a BT and the balance will be NIL by then.

I'd like to believe him as it would be much better for me to do it today but I'm a born cynic and am not sure? It sounds realistic enough I suppose but what do the experts think?

The next thing then is that my HSBC payment is due on the 6th so if I could transfer that balance today, would I be ok stopping that payment on the 6th and just explaining to HSBC what I had done and that the balance will be clear on say the 13th?

Sorry to go on again but any help is greatly appreciated!!???

GeorgeUK

I'd make the payment to HSBC as usual - the transfer won't clear in time and there's no point risking a charge at this stage. Can i ask why you're clearing the HSBC card, and to where?

If you haven't already accepted the HBOS deal i'd try again. Tell them you want to close your card - you have enough credit on your other cards.
Sometimes, the person you are speaking to will make an offer, but if you don't acept can put you through to "customer retentions" who may be able to offer a better deal. If they put you through to close your account, just say you'll need to call back later and don't clsoe the account.

From what you have put above, the first card you need to clear is the LTSB as this has the highest interest rate. Even transferring from LTSB to HSBC without a deal will save you a little in interest, but you don't need to clear the card to ask for a deal.