Jump to content

Credit cards - 0% bal trans/ low interest
Please advice badly needed !!


  • Please log in to reply
13 replies to this topic

#1 k-ko

Posted 01 December 2012 - 10:15 PM

Hi all,
Im after some advice please. ive never had a credit card. My DH does and hes let it get out of control.

Im needing to know exactly what 0% balance transfer cc are and are they too good to be true?

Dhs fees are just eating away at any payments he makes so we're getting no where.... what do we do in this situation...

We could try for a low rate cc which will help out considerably, but im wondering if we should start afesh with a 0% balance transfer card so we can get back on track..

would love some advice as im clueless with cc but Im wanting to learn original.gif
thanks

#2 jayskette

Posted 01 December 2012 - 10:20 PM

First of all, DO NOT EVER transfer any debts into your name!

Secondly, DO NOT EVER go with one of those debt consolidation offers you see on late night TV!

Thirdly, cards are ONLY for the very disciplined, otherwise as soon as the honeymoon period end you are slugged with even more debt.

Canstar and Infochoice offer great articles.

http://www.debtfix.com.au/debt-management-...sfers-5-tips-2/

#3 k-ko

Posted 01 December 2012 - 10:25 PM

thanks Jayskettle, III jump on and have a read.
I have read terrible things about some debt consolidation offers, but im just wondering if there
is any hope with changing of cards etc.

thanks III have a look at your link!

#4 harryboy

Posted 01 December 2012 - 10:25 PM

Agree with PP - only good if you are very disciplined about paying off while the 0% applies.

#5 #YKG

Posted 01 December 2012 - 10:25 PM

TBH I would only ever do the 0% transfer IF I could 100% pay off the balance in full in the allotted time then I would cancel the card and get rid of it all together once paid in full. If I couldn't pay the balance off in full in the time frame I wouldn't do it and call the credit card company to work something out to try and get it down as much as possible. Keep in mind if your DH has made cash withdrawls from his current card that is not included in the 0% interest and will attract interest rates.

I agree with PP do not put it into your name, dont enter into the debt consilidate people as this if more often then not a debt 9 agreement which is the stage before declaring bankrupcy.

#6 jayskette

Posted 01 December 2012 - 10:37 PM

I might give you some examples.

In Uni I recklessly rang up $8000 debt. I had an excellent credit rating otherwise, so I went and got a 1% balance transfer offer for 12 months. I cut up the original and the offered credit cards and paid $1000 over 8 months, and went to the bank to cancel the cards when everything was repaid. The bank kept on asking whether I am sure I want to cancel lol, because I am their worst customer! I did not give them any more than the 1% interest.

The past 6 months were difficult for DH and I, DH was laid off and we had a wedding. We now have 4 credit cards altogether totalling $12K. He has no job while I am earning 70K. I just got a new contracting job that is $160K and I have asked the bank whether I will be eligible for a balance transfer. To do that, I will need to apply in my name (as DH has no income), apply for a gold card with a $15K limit (because credit balance you are transferring has to represent a maximum of 80-90% of the proposed credit limit). As I am now a contractor (aka self employed) I will also need further evidence that this income is sustainable for 12 months, and a guarantee from my employer. I will also be taking some burden of having a possible dent on my credit rating. The bank provisionally approved it, but in the end I decided against it and just pay off as much as I can on the 4 cards. Now that DH has a new job, we will be able to pay everything off in 3 months. Even though that was not "ideal" in the sense of % interest (the cards range from 15-25% interest pa!!) It was the best for us in the long run.

So... balance transfer may not be the best for you at all! It is just like applying for another credit card, and that may not be approved pending on how bad the situation is. You might be better off heavily monitoring DH's spending and just cut the card for example.

#7 LK1

Posted 02 December 2012 - 12:44 AM

The first thing that your DH can do, before applying for anything else, is call his current card, and ask for an interest rate reduction.
I have done it a few times "Hi there, I have been calling other banks about a 0% balance transfer, but was wondering if "X bank" could offer me a lower interest rate before I move lenders?"
I have done this with one bank and had them offer me a 0% balance transfer to another one of their cards, then a lower rate on that card. And they did it all for me, didn't have to change banks, apply for a new card, have a new check on my credit rating.
And he needs to cut that card up and you guys work out a budget.

#8 *lightning

Posted 02 December 2012 - 01:14 AM

You could look into cutting up the card and taking out a personal loan to pay it off. You would have set payments and no credit card.

#9 Guest_Sunnycat_*

Posted 02 December 2012 - 01:23 AM

If you're sh*t with money and think that you might redraw on the amount that you pay off, I would try and get a personal loan to pay it off.

I called the bank for one of my Cc (as wasn't eligible for a personal loan) and they put a 6 month interest free hold on one of my cards. Maybe this is an option for your DH?

#10 TheWanderer

Posted 02 December 2012 - 08:41 AM

Use these offers with caution.  I once used one tô get ahead of a debt I couldn't shift, but unless you understand the details of the fine print you could end up in a far worse situation down the track.

Understand exactly how the bank makes money from them and make sure you don't trigger any of these clauses. For example, many have funny rules about which blocks of money attract the 0% rate and which will attract the higher one. Often this is is explained in ways that seem quite benign but reality carry quite a punch.

With the card I used, it was explained that the promo rate only applied to the balance transfer and any subsequent purchases would be at about 22%. It also went on to say that any payments apply to the block of money with the lowest interest rate first.  On the surface this doesn't seem that important but it is actually critical.   Say I transfered 10k on to the new card at 0%, I then went to buy a shirt for $100 with that card... With the leftover credit limit. When I make a payment, I will not pay off the $100  (which will be at a high rate) until the 10k is paid off in full. So from almost day 1 I start paying a high interest rate, which puts me behind the 8 ball from the get go.

These products can work in your favour but understand exactly how the bank makes money on the product you go fo before you start using it.

Edited by TheWanderer, 02 December 2012 - 08:42 AM.


#11 Coffeegirl

Posted 02 December 2012 - 09:01 AM

QUOTE (*lightning @ 02/12/2012, 02:14 AM) <{POST_SNAPBACK}>
You could look into cutting up the card and taking out a personal loan to pay it off. You would have set payments and no credit card.


Unfortunately most of these loans are at pretty high interest rates themselves and the OP ,ay nit be better off.


We just did a combination of low interest cards and a re-mortgage to clear a lot of CC debt.

It stemmed back to our first mortgage on this house and the bank screwing up their figures to the tune of $25,000.  This was discovered on the day of settlement.    We ended up with them having to issue us a $25,000 CC to put the balance of our mortgage on.  It was nuts!

We also had two other cards and a store card.    We struggled along, paying off what we could when we could, but weren't getting anywhere.  So we transferred the other two cards onto a low balance card.  Cut ALL those cards up and paid it off within the interest free period.  The we started to attack the big one.

We had switched lenders by now to ANZ and the personal banker we had was fantastic.  She worked out that if we topped up our mortgage to cover the store card and the big CC, then paid those payments back into the mortgage on top of the regular mortgage payments, we would a) pay less interest over the period of the mortgage and pay it off 6 years earlier.  


TheWanderer is right.  There are lots of catches to the low balance rates, so make sure you read the fine print.

#12 k-ko

Posted 02 December 2012 - 09:34 AM

Thanks for the replies. and sharing your experiences. III go back over and have a better read again so I have more understanding.

DH is no longer using the cc, im now managing the money and he has a set amount each week in his savings account for his expenses. The cc are gone and we dont intend to use them again. So we will just basically be paying them off, there will be nothing brought on them or cash withdrawals.

If for example we got a 0% balance transfer cards for 12 months we could pay off a big chunk of the debt but after that 12 months I know the rates goes back up to 20ish%.

The other option as others have said is we take out a loan to cover the cc then just pay monthly repayments ..... still paying fairly high interest, but no late fees, interest on interest etc ....

Can someone please explain, if for example we transfer 18k onto a 0% balance card, in 12months pay off 10k.... with the 8k remaining - will we be charged just the monthly interest rate. When do late fees arise? Are they when you cant pay off the amount in full or dont pay off the monthly repayment?
Note: we wont be using the card for ANY purchases - JUST paying it off.

Thanks for explaining, ive read over the banks fees policies but I need it explained in laymans original.gif

Thanks again
k

#13 k-ko

Posted 02 December 2012 - 09:36 AM

I think asking for a lower rate is a good idea too!! thanks LK1

#14 MintyBiscuit

Posted 02 December 2012 - 09:55 AM

QUOTE (k-ko @ 02/12/2012, 10:34 AM) <{POST_SNAPBACK}>
Can someone please explain, if for example we transfer 18k onto a 0% balance card, in 12months pay off 10k.... with the 8k remaining - will we be charged just the monthly interest rate. When do late fees arise? Are they when you cant pay off the amount in full or dont pay off the monthly repayment?
Note: we wont be using the card for ANY purchases - JUST paying it off.

Thanks for explaining, ive read over the banks fees policies but I need it explained in laymans original.gif

Thanks again
k


It will depend on the bank, but all of the ones I've encountered don't charge late fees as long as you're always paying the minimum monthly repayment. Unless there is a clause saying you must pay the balance transfer amount in full by the end of the twelve months, it's very unlikely they would charge you late fees. Don't forget, the end of that 6-12 month 0% period is when the banks make their money, so they want you to take longer to repay, not less time.

We transferred my $15k card to a 1.9% for 12 months a while back, because we knew we'd be able to pay it off in that timeframe. At the time 0% cards were only available for six months, then back up to a 20% rate, and we couldn't do it in six months. Don't forget to factor in annual fees - a lot of these 0% cards have big annual fees, so while you save on interest you might end up breaking even depending on the amount of debt you have to repay.

Definitely approach your bank and say you've been shopping around, because you never know what they'll offer. Do your research on them first too - if your current card is a rewards scheme or something, they might have a lower interest, lower fee one available, and as with a PP they may offer to transfer you to that with an interest free period.





1 user(s) are reading this topic

0 members, 1 guests, 0 anonymous users

 

WIN a $500 Visa debit card

Are you a parent? Simply take our survey for your chance to win a $500 pre-paid VISA debit card.

Breastfeeding doesn't make you a better mum - feeding your baby does

Given my immense dislike of Hopkins and her opinions, I was genuinely shocked to discover that last week she actually said something that I agreed with.

'Toni, another baby has died': the anguish of watching governments fail our babies

It has been six years since whooping cough claimed the life of four-week-old Dana McCaffery. Her parents are angry that lessons learnt weren't enough to save other babies.

Longer breastfeeding linked to higher IQ

A study of 3500 infants has found that babies who are breastfed grow up to be more intelligent and wealthy.

The 2015 flu vaccine: what's new, who should get it

For certain members of the community, catching flu can lead to severe illness or death. A vaccination can be lifesaving.

Dealing with a nappy escape artist

I hear about the tots that have a penchant for ripping their nappies off and the odd one that even smears the brown stuff on the walls and fine home furnishings, and I shudder.

Hospital apologises for 'traumatising' baby mix-up

St Vincent's Hospital has apologised "unreservedly" for a baby mix-up that left one new mum traumatised.

Tips for flying with a baby

Travelling with kids requires a whole other set of skills - ones that I have learned through (sometimes unfortunate) trial and error.

How to stay calm in an emergency

I’m not expecting you to be as calm as you might be right now. What I mean is that if your panic levels are through the roof during a stressful situation, let’s bring them down to just under the ceiling.

Toddler gets 'drunk' after cranberry juice mix-up

A toddler was taken to hospital after a waitress served her sangria instead of cranberry juice at a US restaurant.

We need to stop using this word when we talk about childbirth

Is it shaming to point out that women are often being let down in birth?

The certificate helping parents deal with pregnancy loss

For some people, this certificate will offer a sense of validation that their child was acknowledged as being here and now gone, and will help them with life post-loss.

Grieving families give warnings after toddler deaths

Two Queensland families are grieving the loss of their toddler sons after the boys drowned in separate incidents last week.

The phenomenon of phantom pregnancy kicks

'Phantom pregnancy kicks’ are encountered by many mums months - or even years - after their pregnancy is over.

The health insurance advice you can't afford to ignore

There's one simple switch that could save you hundreds of dollars a year in private health insurance.

4D scans show how smoking affects babies still in the womb

The harmful effects of smoking during pregnancy on unborn babies may be seen in tiny movements in their faces using 4D ultrasound scans, research has found.

How to babyproof your job interview

Once upon a time, I was a fan of job interviews. That all changed after I'd switched careers, had a baby and decided to spend the first year at home with her.

Sign up to our 30 days of #PlayIQ challenge

Sign up to receive 30 amazing tips and ideas for play with baby during the month of April and submit a picture or tip on our social wall for a chance to win an amazing Fisher-Price prize pack.

The most dangerous toddler food trends

Pete Evans' paleo cookbook for kids caused a storm, but there are plenty of other unsafe food trends for babies and toddlers.

Infection killed new mum of twins

Modern medicine could not save 19-year-old Sophie Burgess who died 48 hours after giving birth to twins in the UK.

Win a Ben & Holly's Little Kingdom prize pack

To celebrate the April 1 release of Holly's Magic Wand on DVD and Digital, we are giving away five DVD packs featuring the newest installment of Ben & Holly's Little Kingdom Holly's Magic Wand and many more hours of family entertainment! Enter Now!

Special Ticket Offer, Save $8!

The Essential Baby & Toddler Show is back this April! Save $8 off the door price for a limited time only!

 
Advertisement
 
Advertisement
 
 
 

What's hot on EB

Sign up to our 30 days of #PlayIQ challenge

Sign up to receive 30 amazing tips and ideas for play with baby during the month of April and submit a picture or tip on our social wall for a chance to win an amazing Fisher-Price prize pack.

Man faces jail after giving woman abortion pill smoothie

A Norwegian man is facing jail after putting abortion pills in his ex-girlfriend's smoothie, causing her to have a miscarriage.

'He's a blessing': family of baby born without eyes

Jordy Jackson was born without eyes. He has anophthalmia, which affects one in every 100,000 babies born.

Win one of 5 Cadbury Easter Hampers

With Easter fast approaching, Cadbury are giving away 5 Cadbury Easter Hampers. Enter Now!

Super fit model Sarah Stage defends her pregnancy body

Model Sarah Stage has defended her pregnancy body after critics claimed her slim figure at eight-and-a-half months pregnant wasn't "normal".

Win a Ben & Holly's Little Kingdom and Peppa Pig prize pack

To celebrate the April 1 release of Holly's Magic Wand on DVD and Digital, Essential Baby and Entertainment One are giving away five bumper DVD packs featuring the newest installment of Ben & Holly's Little Kingdom Holly's Magic Wand and many more hours of family entertainment! Enter Now!

Why I post breastfeeding photos online

I love to take pictures of my children. In some of the pictures, my younger son is nursing.

The day I broke my baby

There are things I wish I didn't know. I wish I didn't know that companies make tiny braces, small enough to hold necks no bigger than a wrist.

The place just for dads of multiples

When a couple discovers they're expecting multiples, the dad can sometimes be almost forgotten in all the excitement and preparation. But one group offers a space just for dads of twins and higher-order multiples.

Brave mum calls for domestic violence law reform

A brave mum of two has shared details of the harrowing attacks she suffered at the hands of her partner in a bid to help other victims of domestic violence.

Why I had the new test for Down syndrome

Early last year I turned 35, and having just found out I was pregnant, I opted to have the new test for Down syndrome.

Geeky baby gear

If your family is more into Star Wars, gaming and the periodic table than most, you might want to check out these geek-chic baby items.

2015: the year of the sheep

According to the Chinese zodiac, babies born in the year of the sheep are creative and enjoy spending quiet time with their own thoughts.

Breakthrough genetic testing now available in Australia

Pregnant women will for the first time have access to locally analysed, accurate, non-invasive pre-natal genetic testing when the first Australian clinic to offer the services opens its doors next week.

Grandbabies: the babies born looking old

Not a day under 65 and a lifetime of struggle! That's the look of these newborns, who look adorably older than their real age. Social networking site Reddit recently featured user submissions of adorable grandbabies, here are our favourites.

Family kicked off flight after toddler seatbelt drama

An entire family was kicked off a Cathay Pacific flight when a misbehaving toddler refused to put his seatbelt on.

Stolen baby found after 17 years

A baby stolen from her mother's arms shortly after birth has been found through an astonishing coincidence.

53 creative pregnancy announcements

Announcing that you're expecting can be a time to express your creativity, sense of humour and imagination. Check out how other parents and parents-to-be have broken the news to friends and family.

IKEA hacks for the nursery and kids' rooms

Are you one of those that know the whole IKEA catalogue by heart? Love their stuff but want to personalise it? Here's some inspiration to help you realise the potential of IKEA furniture and fittings.

36 baby names inspired by food and drinks

A French court may have ruled out Nutella as a baby name, but that doesn't have to stop you from taking inspiration from the supermarket (or bottle shop). See what parents in the US have chosen for their delicious little ones.

Clever breastfeeding products

Check out this range of products designed to help make your breastfeeding journey more enjoyable, manageable and convenient.

 

Sign up now!

30 days of #PlayIQ challenge

Receive a daily email from Essential Baby during April with great play tips and ideas, then submit your baby at play photos to our Playwall, Instagram or Twitter for your chance to win.

 
Advertisement
 
 
Essential Baby and Essential Kids is the place to find parenting information and parenting support relating to conception, pregnancy, birth, babies, toddlers, kids, maternity, family budgeting, family travel, nutrition and wellbeing, family entertainment, kids entertainment, tips for the family home, child-friendly recipes and parenting. Try our pregnancy due date calculator to determine your due date, or our ovulation calculator to predict ovulation and your fertile period. Our pregnancy week by week guide shows your baby's stages of development. Access our very active mum's discussion groups in the Essential Baby forums or the Essential Kids forums to talk to mums about conception, pregnancy, birth, babies, toddlers, kids and parenting lifestyle. Essential Baby also offers a baby names database of more than 22,000 baby names, popular baby names, boys' names, girls' names and baby names advice in our baby names forum. Essential Kids features a range of free printable worksheets for kids from preschool years through to primary school years. For the latest baby clothes, maternity clothes, maternity accessories, toddler products, kids toys and kids clothing, breastfeeding and other parenting resources, check out Essential Baby and Essential Kids.