Overdraft, Credit Card and Balance Transfer

Tr1p

Tr1p

Tr1p

Associate
Joined
20 May 2009
Posts
303
Evening folks.

I am after some advice on whether my idea is stupid or not and whether I would be able to do it. A year ago I was having family problems and having to move about and needing money fast I got into some debt, about £2K worth, in a position to pay it off now.

So I have,
  • Overdraft - This is at £1K at the minute but have paid off some of it. Need to get it below £300 to stop getting charged a £1 a day fee.
  • Capital One Credit Card - This has the full balance available on it of £1100, I balance transferred it to the Barclaycard to stop getting charged 30% interest. However, it does have a one off 3% cash withdrawal unlike the Barclaycard.
  • Barclaycard Credit Card - I got this a month ago for the 25 month 0% interest balance transfer deal, currently have £1100 on it and can put another £1K in balance transfers on it.

My idea was to take enough money to take my overdraft under the £300 from the Capital one card, pay the 3% fee to withdraw it, then balance transfer it to the Barclaycard. That way I don't pay any interest on it for ~23-24 months and all my debt is in one place to pay off each month.

Would Barclay's let me balance transfer from the same card I did last time? Also would this idea make sense or is there a easier way?

Cheers for any help.
 
Why would his bank offer him useful advice about products offered by another financial services institution?

Shouldn't be any problems with doing a balance transfer from the same card twice. Best thing to do is plug the interest amounts and fees into a spreadsheet and calculate the total cost of interest paid for your scenario vs leaving things as they are. If one is better than the other then the correct course of action will become apparent.

Ultimately you want to clear the debt which is accruing the highest rate of interest first; and moving that debt elsewhere is a sensible way of doing this if the interest rate is particularly high.
 
Seems a good idea to me, I've BT to Barclay cards twice in a day off the same card.

Get rid of the interest on the overdraft then make use of the 0% .
 
You say that you're "in a position to pay it off now", does that mean "you're in a position to move it around"?

If you meant what you said originally, work on paying off your overdraft first, before anything else. Then work towards the Barclay card £1,100.00 balance. There's going to percentage balance transfer fees to deal with, which I doubt would be in excess of your overdraft fees.
 
Cheers PeterNem. The way I see it is I pay £30 a month interest on my overdraft, which is 3% a month. If I took some money from the Capital One I would get charged £21 one off fee. Then I can balance transfer that to the Barclaycard and that will charge me a 3% fee too. So for about £45 I can get interest free for almost 2 years. I will be paying it back at £150-200 a month so won't pay anymore interest.

Was just more wary of whether I can transfer the same card twice.
 
Well I can take cash out of a ATM, was just going to do that a couple of times then put it in my bank by going into a branch.
 
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