Taking out a loan to pay off existing loan and CC?
Discussion
I'm pretty sure I know the answer to this, and no doubt it's a daft question but I just want to double check...
Currently have 11 months left on a loan with £2607 left to pay (full closure quote, currently paying £240 a month).
Also have £1800 exactly sat on a credit card, however it's a 0% one for another 10 months or so.
Current loan rate is 9.9% (I was 20 when I took it out with minimal but good credit history).
I'm not going to gain anything at all by taking out a £4k loan over 12 months at 5.4% and clearing the existing two debts am I?
Currently have 11 months left on a loan with £2607 left to pay (full closure quote, currently paying £240 a month).
Also have £1800 exactly sat on a credit card, however it's a 0% one for another 10 months or so.
Current loan rate is 9.9% (I was 20 when I took it out with minimal but good credit history).
I'm not going to gain anything at all by taking out a £4k loan over 12 months at 5.4% and clearing the existing two debts am I?
Similar situation to you, I'd avoid it as I know when I paid of my credit card full I could end up using it again. More psychological reasoning than finincial.
Can't be bothered to do the sums right now but surelly you'd not be any better off as you'd be moving half of the debt out of an interest free credit card and onto a 5.4% loan?
Can't be bothered to do the sums right now but surelly you'd not be any better off as you'd be moving half of the debt out of an interest free credit card and onto a 5.4% loan?
CountZero23 said:
Similar situation to you, I'd avoid it as I know when I paid of my credit card full I could end up using it again. More psychological reasoning than finincial.
Can't be bothered to do the sums right now but surelly you'd not be any better off as you'd be moving half of the debt out of an interest free credit card and onto a 5.4% loan?
Exactly my thoughts... Wonder if it would work out better just clearing the loan side of it with a lower rate £2500 loan over 12 months?Can't be bothered to do the sums right now but surelly you'd not be any better off as you'd be moving half of the debt out of an interest free credit card and onto a 5.4% loan?
Any cards out there which offer a 0% on cash transferred to the bank account? There have been some. Get the cash you need to pay off your loan from a 0% credit card, pay off the loan an then youll have all your credit card debt transferred to the same card and youll have all your debt on 0% on one card
There are a few that offer money transfers but do include a % transfer rate
http://www.moneysupermarket.com/credit-cards/money...
There are a few that offer money transfers but do include a % transfer rate
http://www.moneysupermarket.com/credit-cards/money...
I would stick with what you have.
With the current loan, you can save a massive £33 of interest charges by paying it off now, to be netted off against the interest you would earn on your £2,600 -> £0 over the next 11 months.
With the current card, you're not paying any interest, so any decision to switch or pay off can be deferred for 10 months.
Taking out the new loan would cost you £118 in interest payments over the next 12 months, i.e. £85 more than the current situation.
With the current loan, you can save a massive £33 of interest charges by paying it off now, to be netted off against the interest you would earn on your £2,600 -> £0 over the next 11 months.
With the current card, you're not paying any interest, so any decision to switch or pay off can be deferred for 10 months.
Taking out the new loan would cost you £118 in interest payments over the next 12 months, i.e. £85 more than the current situation.
Edited by schmunk on Friday 8th May 15:48
schmunk said:
I would stick with what you have.
With the current loan, you can save a massive £33 of interest charges by paying it off now, to be netted off against the interest you would earn on your £2,600 -> £0 over the next 11 months.
With the current card, you're not paying any interest, so any decision to switch or pay off can be deferred for 10 months.
Taking out the new loan would cost you £118 in interest payments over the next 12 months, i.e. £85 more than the current situation.
As I suspected, just wanted to check I hadn't missed something. Ta for the info With the current loan, you can save a massive £33 of interest charges by paying it off now, to be netted off against the interest you would earn on your £2,600 -> £0 over the next 11 months.
With the current card, you're not paying any interest, so any decision to switch or pay off can be deferred for 10 months.
Taking out the new loan would cost you £118 in interest payments over the next 12 months, i.e. £85 more than the current situation.
Edited by schmunk on Friday 8th May 15:48
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