Balance transfer

[mummyandbaby]

I would like to understand how balance transfers work. Can I transfer an amount of my choice or is there a maximum? How are the monthly payments calculated? How will my credit history be affected with a balance transfer card? I'm desperate to not just service the debt but see the balance reducing. Thanks.

The amount you can transfer will depend on your credit limit. The maximum will depend on the card issuer. Monthly payments will be a % of what you owe like any other credit card. You need to make more than the minimum payments to see the balance reduce. Will it be a 0% interest card you get?

Balance transfers are from one credit card to another. Most do offers of 0% interest for so many months, but you have to pay a transaction fee (maybe 4% or around there) of the amount you are transferring.

How much debt do you have?

Best place to look is Money Saving Expert. Balance Transfer article here

How much can you transfer? Varies between providers, usually about the maximum limit. My last one was a few hundred below the limit I think.

Monthly payments... God knows how they are worked out! I just work out how much I can pay over the the length of the zero interest period and then clear it over the interest free period 😂

It depends on the credit limit of the card you have transferred the debt so for example they may have given you £1000 credit limit so if you have £1200 to transfer then you can only transfer £1000 .
There is usually a transfer fee too that they will add on .
I've just done it on 1 of my cards of £800 transferred so I paid around £20 transfer fee but it's 0% card so hopefully will get it paid off soon as I'm hoping to pay £100-200 a month off .

Depending on how long the interest free period is, you can find ones that don't charge a fee for the transfer. I got one with Sainsbury's for about 20 months interest free with no fee, which was long enough for me to pay off about £4k without it costing me any interest. Cheap way of buying a car!

Thanks for your replies and the link which I"ll read. How would my credit rating be affected? How straightforward is it to apply?

Usually pretty easy to apply online. If you have a good credit rating and don't increase your overall debt then it shouldn't make too much of a difference to your rating. Have you checked your credit on one of the free sites, like Noddle?

It’s simple and there’s a lot of 0% fee ones plus how ever many months free interest (mine is 20).