Using 0% credit card to pay a loan

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  CyberMurning on 02/04/2013 - 14:37

  i think people at whirlpool have more knowledge about this things, also more ppl check wp than ozb.
  better keep the discussion over there.

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  DealzEddy123 on 02/04/2013 - 15:44

  You don't need to max out the first card.
  First card(Card A) has $0 balance. Then you do a balance transfer of your max limit from the 0% balance transfer card to card A.

  Now card A has balance of $0 + balance transfer.

  Then you take that cash out from card A and put in your offset account. (some cards will charge you a one off fee for taking cash out but you won't accrue interest on this cash as it is from a positive balance.

  I like the idea but doesn't suit me personally as I don't have an offset account on my mortgage & also my Credit card limit isn't that high to be worthwhile. ($13,000 @ 5.2%p.a.(my mortgage rate) for 6-8 months is only a few hundred bux).

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  DealzEddy123 on 02/04/2013 - 15:48

  can anyone suggest if this could work without an offset account?
  Can I pay $13,000 of my mortgage in one month and skip my next few month's repayments or it doesn't work like that?

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    Geewhizz on 03/04/2013 - 08:19

    +1

    No, it doesn't work like that. They'll still the following months' payments. From what I can gather, without reading the whirlpool thread, the idea would be to transfer the funds out of the offset account toward the end of the interest free period back to card B.

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  tooblue on 02/04/2013 - 17:38

  +1

  Yes, it is feasible. But someting to beware:
  ♫ Most 0% BT are only for new card, so there will be a record on you creidt file;
  ♫ If the new credit card limit is not high enough (say only $5000), the max you get from this scheme is $5000 * 6% /2 = $150 (presumption: rate = 6%, BT term = 6 month);
  ♫ There maybe complication whether you could use the new BT card during the 6 month (depending on the order the bank applies the payment, it might forfeit the interest free period);