Credit card query?

Question

I am looking at signing up for a new credit card with the sole purpose of taking money from this card to pay off an existing credit card.I am not too sure of what to look for in terms of 0% balance transfer rate and/or 0% introductory purchase rate etc.Can i withdraw a cash sum from the new card to pay off the old card without using the balance transfer route or does this work out more expensive.I do not want to make any other purchases or withdrawals on the new card.

Please help with some advice please.

Answer 1

You have two routes:

1) Balance Transfer

2) Cash Advance (then put the cash in the bank)

Typically, the balance transfer is the better way.

But, make sure that the 0% balance transfer "rate" also has a 0% balance transfer "fee".

There is a difference, and a classic 'gotcha' that credit card companies love to trap you with.

Plus, while you're paying off the new card, you have the old card sitting in your wallet, with a brand new zero-balance, just begging you to spend it at the mall.

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You need a plan to pay it off, and missing one payment will hurt a lot worse than the interest.

So my advice: Cut up the card, then figure out how much you can put down every month toward paying the balance, and then pay it off.

Answer 2

Personally, very bad idea to open another credit card account to payoff/on a current account.

A credit check will be done and another inquiry will go on your credit score.  The 0% sounds like a good deal.  However, if you don't pay off the balance by the end of the intro period, you may get billed for interest back to the date of first opening the account.....

Say you get a second card for $2,000.00 with 0% interest for 12 months.  If you still owe $1,000.00 at the end of the 12 months, you will get charged interest on the $1,000 to the account opening.

It probably would be less expensive to get a cash sum even though you will have fees with cash withdrawal.  The worst thing you could do to your credit is getting in the habit of borrowing from one card to pay another....Been there, done that.  It's really hard to get credit back on track when you "steal from Peter to pay Paul".

Hopefully, you have more self control not to use the new card for any other purpose than to payoff another card.  Many people do not and get into financial trouble that way.