Credit Card to pay off Loan - Super Confused
Hello,
I'm hoping someone can help. My partner and I took out a personal loan of £10,000 to pay for a piece of equipment for our new business. After speaking to my partners sister she mentioned balance transfer cards - we're quite new to all this kinda stuff, so this opened up a whole new world of card types that we had no idea about.
Anyway after all my researching I'm still confused. Is there a way / card that will allow me to pay off the loan - for which we are currently paying £90 a month interest and take advantage of a period of interest free before then transferring this balance to a 0% balance transfer card?
I believe I am right in thinking that I can't use a balance transfer card to pay a loan - only another card?
I hope this makes sense
I'm hoping someone can help. My partner and I took out a personal loan of £10,000 to pay for a piece of equipment for our new business. After speaking to my partners sister she mentioned balance transfer cards - we're quite new to all this kinda stuff, so this opened up a whole new world of card types that we had no idea about.
Anyway after all my researching I'm still confused. Is there a way / card that will allow me to pay off the loan - for which we are currently paying £90 a month interest and take advantage of a period of interest free before then transferring this balance to a 0% balance transfer card?
I believe I am right in thinking that I can't use a balance transfer card to pay a loan - only another card?
I hope this makes sense
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Comments
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No need for super confusion.
You need a money transfer card so you can put the money into your current account and pay from there.0 -
A Credit card offering a money transfer - check the money transfer fees and the 0% term as well - and the APR after the introductory term ends...
you would need a new card with a limit of around £11k, as I believe can only transfer upto 95% of your available balance.0 -
Apply for a couple of cards with money transfer options and see what limits you get. If you get enough then transfer away - you would need to aim to pay off the total amount by the introductory offer (dont pay the minimum) or be prepared to do a Balance Transfer onto another card, if you can get another card.
If for some reason you did not clear it in the 24 months say and you were unable to get another card with a balance transfer option then you will go onto the cards normal rate so factor that in to you money saving calculations.
Good luck.0 -
Hi sy2803 and welcome to the forum
Take a look at the MSE Article about money transfer cards (click below):
https://www.moneysavingexpert.com/credit-cards/money-transfers/I work within the voluntary sector, supporting vulnerable people to rebuild their lives.
I love my job
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You will also need to look closely to see if there are any penalties to paying the loan off early, and indeed to check if there are any benefits to doing so (i.e. do you actually save interest, or is the balance to be repaid already inclusive of the full term interest.)(Although I could be wrong, I often am.)0
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Interest will be saved if early settlement is made. Front loaded interest is a thing of the past.0
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Also think of the money transfer card lender assessing you on 20k of debt not just 10kMortgage free wannabe
Actual mortgage stating amount £75,150
Overpayment start date 1/3/23.
Starting balance £66,565.45
Current balance £63,787.160 -
I think the normal "charge" nowadays for early settlement is 2 months worth of interest only.... but happy to be corrected if not the case0
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