Stick with Abbey???

Jemmie

Hi

I'm in two minds as to what to do about my credit cards. I currently have 2 - Abbey £1,400 and Barclays £3,500. The Abbey card is charging interest so I decided to open another cc account with a 0% interest. I got a card with Virgin and then realised that I can't transfer the balance because they are both owned by the same company (MBNA). I was advised that I could transfer the funds into my bank account still at 0%. I've since received a letter from abbey advising that I can transfer other balances to this card at a 0% rate although I would still have the outstanding amount on there charging interest.

What I am wondering is

1) Can I phone them and ask them to lower the interest rate if I threaten to leave and that way all my outstanding balances can be transferred to this card so as I am only making one payment a month
2) Shall I ask Virgin to transfer the funds to pay off my Abbey cc into my bank account and transfer it straight over to pay off my Abbey card then I am still lefty with 2 credit cards to pay off each month when really I would prefer just the one.

(Incidentally the credit limit with virgin or barclays isn't enough to cover the whole outstanding balance for all cards but Abbey is)

?????? I hope that all makes sense!

Thank you - I just want to make a decision.

Jem

Moggles_2

I'm in two minds as to what to do about my credit cards. I currently have 2 - Abbey £1,400 and Barclays £3,500.

I take it these are balances, not credit limits

The Abbey card is charging interest so I decided to open another cc account with a 0% interest. I got a card with Virgin and then realised that I can't transfer the balance because they are both owned by the same company (MBNA). I was advised that I could transfer the funds into my bank account still at 0%.

IMO, this is the way forward.

Moggles_2

I've since received a letter from Abbey advising that I can transfer other balances to this card at a 0% rate although I would still have the outstanding amount on there charging interest.

Exactly. Not a good move, as things stand.

Your £1400 would continue to accrue interest at your standard rate, which is variable. (In other words, Abbey could raise the rate even higher.)

Moggles_2

Can I phone Abbey and ask them to lower the interest rate if I threaten to leave? That way all my outstanding balances can be transferred to this card, so I am only making one payment a month.

There's no harm in asking, but you're in a weak position, because of that outstanding balance. The lender knows you must pay off or transfer the debt to another card before you can close down your Abbey account.

Moggles_2

Shall I ask Virgin to transfer the funds to pay off my Abbey cc into my bank account and transfer it straight over to pay off my Abbey card?

Absolutely.

... then I am still left with 2 credit cards to pay off each month, when really I would prefer just the one.

Don't let this blind you to the fact that the Abbey offer isn't workable at the mo.

Putting all your eggs in one basket and relying solely on one credit card is not necessarily money saving, but if this is your goal, why not aim to clear the balance on your Barclaycard asap using some of the money saved with your new Virgin 0% deal. This lasts 15 months I believe.

Moggles_2

Incidentally the credit limit with Virgin or Barclays isn't enough to cover the whole outstanding balance for all cards, but Abbey is.

Although you cannot transfer balances between two cards underwritten by the same lender, MBNA is sometimes prepared to move credit limits between its cards. It's worth a phone call to Virgin

CannyJock

Jemmie wrote: »

Shall I ask Virgin to transfer the funds to pay off my Abbey cc into my bank account and transfer it straight over to pay off my Abbey card then I am still lefty with 2 credit cards to pay off each month when really I would prefer just the one.

If it's an "old" Abbey card when they were run by MBNA, you won't be able to transfer between it and Virgin, is from the same family of cards.

"New" Abbey cards are backed by Santander and they seem to be keen to offer people deals to move balances from "old" Abbey cards onto them - 13 months 0% I think.

If you've got two MBNA cards, I've read elsewhere that you can ask them to "consolidate" the credit limits on their cards onto the new card.

So I'd be tempted to try the following:
1. Transfer maximum balance from Virgin direct to current account, take full 95% of credit limit and be sure to setup the direct debit.
2. Clear the Abbey balance, and pay as much as possible off the Barclaycard balance.
3. Once Abbey is clear, ask them to consolidate the credit limit onto the new Virgin card.
4. Transfer the remaining balance on the Barclaycard not paid by the initial amount onto the Virgin card (either via your bank account or directly to the Barclaycard).

If all goes according to plan, you'll have all your debt on one card and apart from the initial 2.98% fees, no interest for around 15 months.

Jemmie

Many thanks for your replies. Canny Jock, I followed your advice and have managed to consolidate the credit limit with just £300 left on my Barclay card and the Abbey card will be fully paid off after the money is transferred into my bank account. I've set up a direct debit on the virgin card as well.

Thank you!

Jem