If you have credit card debt which is attracting a high level of interest, moving this balance onto a lower interest card could save you a considerable amount of money. This process is known as a ‘balance transfer’, and if done correctly, this could save you money and also reduce the time it takes you to clear the balance. This is because by shifting your existing debt onto a card which charges little or even no interest means that your monthly payments will go towards reducing the amount you owe, rather than merely covering the interest.
Sounds good? It is, but only if you meet the credit card providers often strict criteria. Whenever you apply for credit, whether this is as a loan, credit card, or overdraft, the lending company will conduct a credit search to determine whether they are happy to lend you money. The better your credit rating, the more likely it is that you will be accepted by the lender.
There used to be no way of knowing the likelihood of whether you would meet these requirements other than applying for the card and waiting to see whether you were accepted. The problem with this is two-fold. Firstly is the amount of time you may waste by continually applying for cards only to find your application ultimately rejected. Secondly, every time a credit search is conducted this leaves a footprint on your credit file. Too many of these footprints on your file can sound alarm bells with possible lenders who may view this as evidence that you are desperate to obtain credit.
However, thanks to a Money Saving Expert tool, you can now discover your likelihood of being accepted without having to go through the formal application process or risk leaving a mark on your credit file. This is because the eligibility calculator conducts what is known as a ‘soft search’. This type of search is not visible to lenders meaning it will not have a negative impact on you when you come to apply for credit. In order to perform a soft search, you will need to give certain personal details such as your name, address, employment status and salary. While this tool can give you a very good indication of whether you are likely to be accepted for a product, it is not able to give you a definite answer. You should be aware that when you do come to apply for a credit card, your lender will perform a hard credit search on you which will leave a footprint on your file. You can try the Money Saving Expert eligibility calculator for yourself by clicking here.
If you are accepted for a balance transfer card you should ensure you make all your minimum monthly repayments on time or risk your low interest rate shooting up. Also, remember balance transfer cards should not be used for additional spending as this will typically be charged at a higher interest rate.
If you are struggling with credit card debt and would like professional advice and guidance, Scotland Debt Solutions are here to help. You can arrange a completely free no-obligation initial consultation at any one of our five offices located across Scotland. We will take the time to fully understand your situation and suggest the best way forward for you.
The Register of Insolvencies is a public register that documents Trust Deeds until five years after the discharge date and includes personal details.
Joint Trust Deeds don’t exist, however, if you want to run a Trust Deed that encompasses debts as a couple, this will be two individual Trust Deeds.
Our Scottish based team can help advise you on your debt problems.