Balance Transfer Question

LRilo 117 on 06/12/2016 - 23:04

Hey Guys,

This is a question that looks like it gets asked a lot but I thought I'd through my situation out there are see what responses I get.

I'm currently looking at doing a Balance Transfer on both my commonwealth Credit Card and my fiancé. Both are Maxed at $3000 each, we both pay a bit over the min but once the interest gets thrown in, we're are barely making a mark in them. I work full time ~$68,000 and she works 2 days a week ~$20,000, which weekly mainly goes towards our son's day-care and her car loan (~$24,000 left to pay ~3years we're paying more than the min).
I also have a person loan that I'm paying off, $6000 left at 13% interest (I think), that has ~1 year left.

We want to get out of debt as fast as we can so we can start planning our wedding.

So after some research, I think the best bet for us would to transfer balance both cards to a 24 month, Citi Rewards Platinum Credit Card, that has a $199 Annual Fee and a 1.5% BT Fee (~$90).

I think we should have the card paid off in about 16months (going off our current payments), and also can contribute more to it after my Person Load is paid off in 12months.

Am I on the right track or can someone please add their thoughts or if they've had personal experiences in a similar situation.
Link Below;
https://www.creditcard.com.a​u/citibank-rewards-platinum-credit-card/

Regarding that Citi Rewards Card, I can also pay off my personal loan as well. So by combining the 2 CC and my Personal Loan, it would be ~$12,000. I think my Loan does have an early exit fee but I believe last time I spoke to them on the phone, it was ~$300.
We could make a monthly payment of $600 (or a little more) and have it paid off in 20months.

Also I read from I another forum that I might not be able to transfer my fiancés credit card, it all has to be in my name? Any way around this?

Lastly, credit rating wise, will doing this hurt us? We still rent and want to buy a House within the next 5-10 Years and would like a fuss free application. Will doing a balance transfer become a black mark on our names?

Cheers everyone and thanks in advanced.

Financial

Comments

  • Findo on 07/12/2016 - 00:02
    +1

    Why not transfer to the latest westpac card offer? No fee for the first year and a much lower annual fee than the Citi one you mentioned.

  • garetz on 07/12/2016 - 02:47

    I agree with the above post, get the westpac offer, seems to offer you what you are looking for at a cheaper price. Balance transfers do not affect your credit rating. What affects rating is not paying bills and excessive loan/credit card applications.

    The only way you can get both credit cards transferred over to a new one with different names, is to take the new card out in both names.

    As for the personal loan, all interest is calculated in the repayments, if you pay early, you are still paying the exact same interest you would have paid if you paid the loan off as required. In fact paying it early means you lose $300 for paying it off early, which doesnt really make sense to do. by repaying the personal loan off early, and putting it on your credit card, you may actually be paying twice the interest over time.

  • AlienC on 07/12/2016 - 03:13

    Unfortunately the internet has become obliviously it's worst enemy aka George Orwell's 1984 and essentially a form of negative nice mind and absorbing assuming a lack mentality and not many people or none at all are really aware or really realise this.

  • sparkles on 07/12/2016 - 06:54
    +1

    I'm kinda curious how your fiance got a $24k+ car loan on a $20k salary. This seems way overcommited. Working simply to pay childcare and a car seems futile to me. Could you improve your situation by downgrading the car and simply eliminating the debt in one fell swoop? You would be in a much better position and could work towards the wedding/house right now as opposed to it being a future goal.

  • nickomac on 07/12/2016 - 07:26

    Checkout the St George Vertigo (http://info.stgeorge.com.au/creditcards/vertigo/), $55 annual fee and 18 months @ 0% (with no BT fee) - you'd be saving ~$234 compared to getting that Citibank card in the first year alone!

  • Rilo 117 on 07/12/2016 - 08:14

    @ sparkles, she makes ~$450 A/T and she previously had a small hatchback. When we got pregnant we decided that we need a safer new car for Bub and bought a 2014 Holden Captiva diesel. Something we kinda regret later, because she would prefer to stay home with bun then work, but because we have that loan she can't. She makes enough weekly for that payment, daycare and some for food/bills.

    @garetz & nickomac both of those sound good. I think I'll focus on paying just the $6000 off within 18month BT offer. Once my personal loan is done I can then through more at the BT debt and hopefully knock them all out weighing 14-15months. Glad to hear it doesn't effect our credit rating doing it, hopefully we don't get knocked back :)

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