Balance transfer credit limit question

clouise44_2 · 11 July 2017 at 2:02PM

I currently have a Barclaycard credit card with around £6060 of debt. The 0% runs out in October but I started to feel angsty about forgetting closer to the time. A colleague at work had just transferred her balance to the 41 months interest free Virgin card so I applied as well.

However I was only given a credit limit of £3600, not enough to cover the balance transfer. Should I keep both cards until October and apply for another card to cover the rest of the Barclaycard debt then? Or apply for another card now? Which would look better on my credit report. It's obviously still two searches but would it make a difference 2 months apart?

Also I have a Halifax card, where I originally obtained the debt before transferring it to Barclaycard. Should I close this account now? I kept for emergencies but having soon to be 4 cards seems a bit reckless and extreme to me. Should I close the Barclaycard too as soon as I (hopefully) transfer the rest of the debt?

(plus the barclaycard was interest free spending too, so my original debt of £2000 soon spiralled into £6000 as I couldn't help myself from spending it. The Virgin card only has 3 months interest free on purchases which I felt would stop my spending!!)

Thanks for the help!

surreysaver · 11 July 2017 at 2:09PM

Ring Virgin up, tell them the amount you want to transfer, and ask them if they'll increase the limit.

clouise44_2 · 11 July 2017 at 2:13PM

Thanks for the advice.

As soon as I get my confirmation email through I will ring them up. They sent an email through saying i'd been accepted but not had any of the details through yet.

eskbanker · 11 July 2017 at 2:26PM

I'd be surprised if Virgin, having just offered £3600, would agree to an immediate limit increase - they may do so six months in but without any history to go on why would they suddenly change their minds about the initial limit?

And it would be prudent to start making plans for repaying the debt rather than simply shunting it around - even if you can get 0% coverage for most or all of the debt this year, what will you do if you can't next time round?

clouise44_2 · 11 July 2017 at 2:44PM

Like I said that is exactly why I wanted to transfer the debt to a card without interest free spending, so I could start to pay off the debt rather than digging myself deeper.

When Virgin said I was pre approved for the card when I filled in the form on their site I assumed that it meant I was approved for the whole balance transfer I'd said I needed so I went ahead and applied for it. I didn't realise that they would offer me a lower limit.

I pay £250 a month into my Barclaycard right now, however I always ended up dipping into it at the end of the month when i'm short of cash. With paying £150 a month for 41 months the Virgin website said I would have paid off the debt by the time the 0% finished.

Plus with only paying £150 instead of the £250 I was trying to do now I'd have an extra £100 in my actual bank, making it easier for me to stop myself from needing to dip into credit.

Edit: Obviously I get that my financial situation is dismal, and i've made mistakes. I wouldn't be here asking for advice if I wasn't thinking about paying off my debt. Could someone give me some advice on the questions I asked?

1. Should I apply for another card now or later?
2. Should I close my halifax credit card account with nothing in it?

MallyGirl · 11 July 2017 at 3:02PM

clouise44 wrote: »

(The Virgin card only has 3 months interest free on purchases which I felt would stop my spending!!)

Thanks for the help!

Don't do any spending on a balance transfer card unless it has exactly the same length of deal - otherwise you will get in more of a pickle

MallyGirl · 11 July 2017 at 3:07PM

I would take the new Virgin and BT as much as you can of the BC debt. Then it gets more open to interpretation. If you have had the Halifax a lot longer then maybe keep it (length of financial relationship is a positive factor in building a good credit history) but get the BC limit reduced to just above the remaining debt so that your overall credit exposure is lower. If the Halifax isn't much older then close it, and still reduce BC limit but leave a bit of headroom on there for emergencies.
Once these changes have filtered through the systems in a couple of months then you could have one more try for a BT card to try and move the rest of the BC - start with soft searches before leaping in.

clouise44_2 · 11 July 2017 at 3:08PM

MallyGirl wrote: »

Don't do any spending on a balance transfer card unless it has exactly the same length of deal - otherwise you will get in more of a pickle

I won't be doing any spending, that's why I wanted to choose a card without interest free spending.

clouise44_2 · 11 July 2017 at 3:26PM

MallyGirl wrote: »

I would take the new Virgin and BT as much as you can of the BC debt. Then it gets more open to interpretation. If you have had the Halifax a lot longer then maybe keep it (length of financial relationship is a positive factor in building a good credit history) but get the BC limit reduced to just above the remaining debt so that your overall credit exposure is lower. If the Halifax isn't much older then close it, and still reduce BC limit but leave a bit of headroom on there for emergencies.
Once these changes have filtered through the systems in a couple of months then you could have one more try for a BT card to try and move the rest of the BC - start with soft searches before leaping in.

Thanks. I think first i'll call up Virgin and see if they could increase my credit limit even a little (it can't hurt right?) then transfer as much as I can. I like the idea of then reducing the credit limit on the BC, I hadn't thought of that thanks.

I've had the Halifax card since January 2015.. I then transferred the balance to BC in March 2016. It's not been used since then.

MallyGirl · 11 July 2017 at 3:38PM

when you look at your credit report it shows both the total credit available to you and the percentage utilised. It is a matter of juggling so that utilisation isn't too high but also that total available credit is not too big in relation to your gross salary - rule of thumb to not exceed half your salary but I, and many others, have exceeded that with no issues.

clouise44_2 · 11 July 2017 at 3:53PM

MallyGirl wrote: »

when you look at your credit report it shows both the total credit available to you and the percentage utilised. It is a matter of juggling so that utilisation isn't too high but also that total available credit is not too big in relation to your gross salary - rule of thumb to not exceed half your salary but I, and many others, have exceeded that with no issues.

My credit score, as of now, is 487, I have 9 positives and 0 negatives. My total credit available is £8300. £6100 with BC and £2200 with H. And i'm currently using £6060 of that. My salary is around £16,000.

That's obviously not taking into account the recent search that Virgin did, and the now added £3600. However as soon as I reduce the limit on the Barclaycard it should be back down to the same amount of credit available.

Balance transfer credit limit question

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