Credit Card Debt - Loan?

PixelChef

PixelChef

PixelChef

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Hi all,

I have quite a bad credit card debt at the moment. The interest is quite high (17.9% APR), currently I'm paying off as much as I can each month.

I've been thinking it might be an idea to take out a loan to pay off the debt, then obviously pay back the loan, hopefully with lower interest?

I have no experience with loans, does anyone have any advise for a very low interest loan?
 
If you can get a low interest loan then you can also get another credit card - pick one that does 0% on balance transfers, transfer your balance, job done.
 
[TW]Fox;21515482 said:
If you can get a low interest loan then you can also get another credit card - pick one that does 0% on balance transfers, transfer your balance, job done.
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Hmm, never heard of that. Had a quick look, so: transfer the balance of this card to a new one, pay it off with 0% interest. Simple as that?

NeoReloaded said:
Think you need to tell us how much you are in debt and what you are paying back.
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About £4300, paying off avg £300 a month, interest £80 a month (slowly decreasing obviously)

Windle said:
0% balance transfer and cut up your existing credit card and the new one so you don't spend on them. That's if you're serious about getting rid of your debt and ensuring you don't rack up a replacement one.

Best 0% balance transfer deals are listed in the link below from MSE.

http://www.moneysavingexpert.com/cards/balance-transfer-credit-cards#barclaycard22
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Thanks. Yes I'm serious about getting rid of the debt, I haven't used this credit card to buy anything for about a year, and won't be using a new one.

:/ I should really have looked into this before :p
 
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oL said:
Hmm, never heard of that. Had a quick look, so: transfer the balance of this card to a new one, pay it off with 0% interest. Simple as that?
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Nearly as simple as that, you will pay a fee (typically up to 3%) which will be added to the balance but still 0% apr. Any purchases you make on the new card will be subject to interest though, usually at similar rates to the one you already have so if you go down this route do yourself a favour and cut up both your existing and new cards so you aren't tempted to start racking the debt up again.

Oh and make sure you setup a direct debit for at least the minimum payment as the majority of balance transfer cards have clauses that if you don't pay on time you'll get hit with a fee but sometimes it can affect the 0% apr as well.
 
oL said:
Hmm, never heard of that. Had a quick look, so: transfer the balance of this card to a new one, pay it off with 0% interest. Simple as that?
Click to expand...

It's as simple as that. You are usually charged a fee - between 2 and 3% of the outstanding balance - but thats the only charge.

Of course you may struggle to get a big enough credit limit with debt outstanding already but even if they only give you 2k thats 2k of your debt thats no longer attracting interest.

And if your credit rating is sufficiently poor that you cannot get a 0% credit card you wont have much luck with a low interest personal loan anyway.
 
What would you do if the credit card debt was so large that another couldn't be found without going for a loan? Get 2 credit cards?
 
mejinks said:
What would you do if the credit card debt was so large that another couldn't be found without going for a loan? Get 2 credit cards?
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Numerous consecutive applications dont do your credit rating any favours but once you've secured one succesful one there is no harm in trying for another - but if that doesn't work its probably best to stop there.
 
if your in bad credit debt atm good luck getting a loan or another credit card. best thing to do is speak to your suppliers and ask for frozen interest with a gauranteee that you will pay X a month. Did that with 2 of my cards and gone from 7k debt to about 1k in the space of 2 years.
 
What you want to do is overpay as much as you can.

If you get one say 9mths interest free... on 4300 you will add say 110 quid for the fee, so say around 4400 left to pay.

9 months at like 50 quid will shave off 400 quid or so.... then you will be needing to transfer again, another fee... ok the interest is saved a bit, but you will be forever applying etc

Need to switch it, and keep paying that 300 quid so after 9 months you have cleared nearly 3k interest free, which is not too shabby at all. Leaves you 1500 or so to switch, a nice smaller fee probably around 30 quid and within 5-6 months of that card you should be done.

Do yourself a chart if it helps motivate you, just think I know my maths is rough and I dont know the exact figures but if its similar to above and you can shift 300 p/m you could be credit card free in 18 months!
 
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