Money Transfers

Pull cash from your credit card to your bank account at 0% interest

0 interest car loans sign directing readers to the buying a car on credit car article

 

Who suits this article? Anyone with a good credit rating that is looking to transfer cash to their bank to owe their credit card instead, reducing interest and saving money. 

If you’re looking to borrow money for a new car at zero interest read how to buy a car on credit card

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Money transfer credit card to bank account

Moving debt from one credit card to another is commonplace, you can allocate a 0% money transfer from your credit card directly to your personal or business bank account. This cash can be used to settle an overdraft or provide yourself with an interest-free (0%) cash loan, in some cases, for up to 39 months.

The strategy laid out below is complex, but equally powerful. In short, learn how to dramatically reduce interest on borrowed money whilst you budget your way to pay off debt.

 

Six Things To Know About a 0 Money Transfer Credit Card

There are six crucial things to keep in mind before doing a money transfer. After all, if it’s done wrong, there could be a considerable financial cost.

 

1. Never withdraw the cash.

Under no circumstances should you withdraw the cash. Always ensure the money is transferred directly to your account. Simply tell the card provider, “Transfer the money to my current account.” If you withdraw the money as cash, it will appear on your credit report and you will be charged interest, even if you pay off the entire amount at the end of the month. By transferring the money, you get the deal, including the card’s cheap rate, and the cash is in your account.

 

2. Only borrow if it is necessary.

Unlike moving your debt from one card to another, money transfers usually require new borrowing. It’s a good idea to treat them as you would a loan. Add the transferred balance to the fee you pay. Then, divide this by the number of months you will have 0% interest. Make certain to pay at least this amount every month to make certain the debt is paid off before interest starts to accrue.

 

3. Always make your monthly minimum payment.

If you do not pay the minimum amount every month, it is highly likely that you will LOSE the cheap rate and be charged penalties. If you can, pay a little extra each month.

 

4. Never use a money transfer card as cash.

Banks always apply your payments toward the most expensive debt first. When the 0% period is over, interest will be applied to the full balance, including any cash you may have withdrawn. In other words, you could end up paying heavily for that £20 you withdrew to buy a muffin from a street vendor.

 

5. Don’t automatically assume you’ll get the headline deal.

While cards heavily advertise their 0% offer, it isn’t guaranteed, especially if you have poor or no credit. Instead, you may get 0% for a shorter period or be hit with a higher APR or fee. Always read the fine print so that you know exactly what you are getting before you sign up.

 

6. Take advantage of our online eligibility calculator.

Although the only way you will know for certain whether you will be approved, our money transfer eligibility calculator can predict the odds and tell you which cards you are most likely to be approved for. This will keep you from filling out countless applications, which take effort and can affect your credit score.

Todays Market Best Buys

Low-Fee Money Transfers

Below you’ll find a short list of the top cards currently on the market that offer the lowest money transfer fees. If it’s going to take you an extended period to repay your debt, your best option is to choose a card with longer 0% money transfers.

Cheapest Fee for a 0% Money Transfer

Virgin Money Card #1

The Virgin Money card has the lowest fee of any on this list and offers 0% interest for 20 months. This is a great option if you can pay back your entire debt in this length of time.

Things to Know:

  • This card is issued by Mastercard and requires that you make the transfer within 60 days.
  • After the 0% period is over, you will pay 20.9% interest on any remaining balance.
  • This card also gives you 0% on balance transfers for 38 months. However, a 1.5% applies. When the 0% period is over, you’ll pay 20.9% interest on your remaining balance.
  • You will LOSE the 0% deal if you do not pay at least your minimum payment every month. The minimum repayment is the greater of £25 or 1% of your balance plus interest.
  • Never withdraw cash from this card. The cheap rate doesn’t apply.

Click here to apply

Low 0% for an Extended Period with a Higher Fee

MBNA Card

This MBNA card allows approved applicants to transfer their balance at 0% for as long as 39 months. However, the fee of 3.45% is a bit higher than the cards above. Not everyone will qualify for the 39-month period. In some cases, you may be offered 0% for a shorter period.

Things to Know:

  • This card is issued by Visa and requires that you complete your money transfer within 60 days of opening the card. If you fail to do so, you will be charged a 5% fee and pay 22.9% interest.
  • Anyone with a lower credit score may be approved for fewer months at 0%.
  • With this card, you can also get 0% balance transfers for as long as 2 years. However, the 3.45% handling fee is high.
  • After the free interest period is over, you will pay 22.9% interest on any remaining balance.
  • You must make the minimum monthly payment of £25 or 1% of the balance plus interest, whichever is greater, or you will forfeit the 0% deal.
  • Do not use this card for cash. The cheaper rate does not apply, and cash withdrawals appear on your credit file.

Click here to apply

One month less at 0% and a slightly higher fee. Still a good option if you don’t qualify for the one above

Tesco Card

This Tesco card offers 30 months at 0% and requires that you pay a higher fee of 2.69%. If you have a lower credit score, you may only receive 26 or 32 months at 0%.

Things to Know:

  • This card is issued by Mastercard and requires that you complete your money transfer within 90 days of opening your account.
  • After the 0% period is over, you will pay 20.6% interest on any remaining balance. Anyone with a lower score may have an interest rate as high as 29.2%.
  • You will LOSE the 0% deal if you do not pay at least your minimum payment every month. The minimum repayment is the greater of £25 or 1% of your balance plus interest.
  • Never withdraw cash from this card. The cheap rate doesn’t apply.
  • To apply, you must have a minimum income of £5,000.

Click here to apply

 

0.5% Fee and Low 5-Year Rate

MBNA 5 Card

This MBNA 5 credit card has a one-off fee of 0.5% (at the time of your transfer, which must be made within 60 days of opening your account) and a 4.9% interest rate for 60 months. This is an ideal alternative to a small loan if you will be able to pay the balance within the 5-year period.

Things to Know:

  • This card is issued by Mastercard and requires that you made the transfer within 60 days and pay the one-off fee of 0.5%.
  • At the end of the 5-year period, your interest rate will increase to 8.9% on any of your remaining money-transfer debt.
  • Anyone with a lower credit score may qualify for an initial interest rate of 9.9%. At the end of the 5-month period, the interest rate may increase to 11.9%.
  • You will LOSE the 0% deal if you do not pay at least your minimum payment every month. The minimum repayment is the greater of £25 or 1% of your balance plus interest.
  • Never withdraw cash from this card. The cheap rate doesn’t apply.
  • You must have a minimum income of £20,000 to qualify. There are no further restrictions.

Click here to apply

Money Transfers

FAQs

  1. Q: My debt is already high. Is this going to help me?
    A: If you remain disciplined, it may. Money transfers are ideal for paying off payday loan or expensive overdrafts. As a bonus, you have longer to pay off the debt and at 0%. If you do not qualify for these cards, you will need to look at more severe cost-cutting measures to pay down your debt.
  2. Q: My credit score is great. Why was I rejected?
    A: It’s not all about your credit score. Instead, lenders want to see that you can afford the card, while also ensuring you will be profitable for them.
  3. Q: Will I be paying less each month with a lower interest rate?
    A: No. They aren’t related. Credit cards allow you to choose how much to pay each month, provided you make the monthly minimum repayment amount. The interest rate is the cost of the debt. Here’s an example. If you have a 30% rate on £1,000, you will spend £300 yearly if you maintain a constant balance.
  4. Q: I need a higher credit limit than what is being offered. What can I do?
    A: You always have the option of applying for another money transfer card. In the meantime, you may want to use the card’s limit to pay off as much as your debt as you can.
  5. Q: Can money transfers be used for stoozing?
    A: Yes. Stoozing is an advanced way of using credit cards to make free cash.

 

Marcus
Used Car Guy

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