# Transferring credit card balance to finance?



## Lloyd71

Wondered if anyone has any advice on this, have been on the phone to HFC Finance after I had several accounts with them and they've offered to take my credit card balance off me.

Basically they said they could pay the balance off on a loan with a lower interest rate. I'm currently paying £50 a month off my credit card (the minimum payment is £40) but could stretch to about £70. They told me for £62 a month it would be gone in 2 years, instead of it taking 4-5 years at my current rate.

I'm going in for a meeting with them on Friday anyway to talk through some changes to my existing accounts (new job etc.) but does anyone have any advice on the kind of things to look out for? It seems like a decent deal to me, as my rate with HSBC is very high, and the card is only used for emergencies. 

I was looking into 0% on balance transfers but I won't be able to qualify for those. I'm worried that there must be a catch somewhere along the line! Anyone have any advice?


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## Bigpikle

just compare the interest rates (APR) and make sure there are no extra charges for early payment and setting it up etc. It would be a good idea to pay off as much per month as you can afford off your highest interest rate debt, so if you can afford £70pm then put it into reducing the debt as quick as possible IMHO.


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## Silver R26

Bigpikle said:


> just compare the interest rates (APR) and make sure there are no extra charges for early payment and setting it up etc. It would be a good idea to pay off as much per month as you can afford off your highest interest rate debt, so if you can afford £70pm then put it into reducing the debt as quick as possible IMHO.


I agree with the above, have you tried speaking to your credit card company and asking for them to reduce the rate as you are struggling etc. Sure in this climate they will look at it. HFC might try and sell you there 'loan insurance' which can be expensive, if you feel you need it you can buy it much cheaper through other providers than the one you have your loan with.

Not sure what the going rate for APR is but try going to http://www.moneysupermarket.com/loans/ go to the loans bit put in the details loan amount, loan period and see what they come up with they will compare alot of different providers. You might find you can get it cheaper.

I shall stop waffling now.


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## petenaud

most bank loans will be cheaper than cc.


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## Silver R26

petenaud said:


> most bank loans will be cheaper than cc.


Must admit I thought that until recently however they are still keen to keep your custom and I am not saying it happens all the time but they are willing to look at things if you are struggling for want of a better word.


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## edsel

Beware of penalty charges on credit card transfers on 0% if you're late on a payment for example the 0% deal may become void and then they start charging you full wack.
Most loan rates will be cheaper the cc rate but there aint decent rates available imo.
Havent seen much offered below 8% and the amounts they lend have been reduced.
Then theres the credit scoring which is mad at the moment, to qualify for prime rates you need to be literally cleaner than clean.
It literally is about being in the right place at the right time. A bank might have £xxxxx amount to lend through the month and if they have exceeded that amount they may turn you down with a lame excuse.
It really is a bad time to move money around


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## Lloyd71

Thanks for all of the help, I've been told that I already qualify for the transfer and I'm not struggling too badly or anything, just would be nice to be able to get a lower rate is all.

I believe the only reason they can transfer so easily is because HFC is part of HSBC and my credit card is a HSBC card. Or is that not the case? I'm going to be asking about making payments larger than the £62 per month, and paying off early to make sure there are no extra charges. 

As far as I'm aware through previous dealings with them the only extra charge for early payment of the whole sum is a £30 admin fee. But that was on lower amounts (£300 or so)


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## Silver R26

Lloyd71 said:


> Thanks for all of the help, I've been told that I already qualify for the transfer and I'm not struggling too badly or anything, just would be nice to be able to get a lower rate is all.
> 
> I believe the only reason they can transfer so easily is because HFC is part of HSBC and my credit card is a HSBC card. Or is that not the case? I'm going to be asking about making payments larger than the £62 per month, and paying off early to make sure there are no extra charges.
> 
> As far as I'm aware through previous dealings with them the only extra charge for early payment of the whole sum is a £30 admin fee. But that was on lower amounts (£300 or so)


Early repayment of loans might not save you as much as you think. With a loan the interest is front loaded which is in accordance with FSA rules for example the first payment of a loan will be 90% interest 10% capital then this changes every month until the end of the loan so the last payment will be the opposite. So if you had a 2 year loan and decided to pay it off after 18 months the actual interest saving wont be as much as you think. As most of the interest would have already been paid and it would mostly be capital left.

If you ask your HFC advisor they will explain and should have an example based on your details which will show all those details.


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## Lloyd71

Silver R26 said:


> Early repayment of loans might not save you as much as you think. With a loan the interest is front loaded which is in accordance with FSA rules for example the first payment of a loan will be 90% interest 10% capital then this changes every month until the end of the loan so the last payment will be the opposite. So if you had a 2 year loan and decided to pay it off after 18 months the actual interest saving wont be as much as you think. As most of the interest would have already been paid and it would mostly be capital left.
> 
> If you ask your HFC advisor they will explain and should have an example based on your details which will show all those details.


Ah, I didn't realise that. Thanks for the help!


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## Bero

0% Balance transfers work fine, just set up a direct debit for as least the minimum payment and then you should be ok, you just pay about 3% transfer fee. The down side is you need to keep swapping cards every time the deal runs out.

Have you thought about a life of balance transfer onto another cc? Basicly you transfer to another CC and they will give you a low rate until you pay it off, just make sure you NEVER spend any other money on the card. Post Office is the current best i think.


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