I heart my bank

Sadly blogger.com wouldn't let me put an actual heart symbol in that title.

I love my bank. That's something I didn't ever think I'd say!  Here's why:

Every 3 or 4 months they send me options for my credit card (this is my small credit card, not the hefty one I'm paying off).  The options are, to do balance transfers onto it from other cards at a 3% fee, with the amount transfered staying at 0% APR for 9 months, or to transfer funds from my credit card into my current account to do with them what I choose, with this amount also at 0% APR for 9 months. 


I've never really given these offers much thought before.  However, this time, I thought about it.  I owe a friend £450 (originally £700) from when I hit a crunch point with my finances - my light bulb moment, you could say.  I feel this hangs over our friendship and I want it gone.  However, it makes financial sense to pay off my credit card first as I pay interest on it, and then pay off my friend, even if it's not great for our friendship, but I have been struggling with this more and more lately. 

I decided to take decisive action.  I decided £100 from my work bonus would go on this debt, bringing it down to £350, and then I would borrow the remaining £350 on this deal on my credit card, giving me 9 months interest free to get £350 together (through eBay sales etc.).  This would have the advantages of paying off my friend, having time to pay this off my card interest free, and a specified time limit to get my arse into gear to pay it off.

So I rang up the bank to find out more details.  I used the 'Saynoto0870' website to find an alternative number to the 0845 number on my letter so that it would be included in my mobile phone minutes.  This meant working my way through several departments to get to the right one, but a free phone call.  I eventually spoke to a very helpful lady in the credit card department, and asked her various questions about this deal - how it would show up on my statement, what the APR would be at the end etc. etc.  She then pointed out to me a useful loophole - that I could borrow the £350 that I want AND also borrow enough to cover my existing balance (just under £400), transfer this £700 to my current account, and then use £350 to pay my friend, and £400 to pay my credit card bill.  This then means my existing credit card bill becomes 0% APR for the next 9 months, as well as the money used to pay off my friend.

What a great idea!  Now, why didn't I think of that?!  We worked out that even with the balance transfer fee I would still save money, as the fee on my current balance would be £12 and I pay that in interest over 2-3 months anyway.  The remaining £10.50 of my fee would be on the money transfered for my friend, but that's a small price to pay to get that debt cleared and my friendship less awkward.

I asked the lady if I could do this deal every time it's offered just to make my balance interest free, and she said yes.  She put me through to the balance transfer team and it's all sorted, they told me it will take up to 7 days to go through.

I texted my friend to let him know he'll recieve all the remaining money from me hopefully next week and he's delighted.  The small amount of strain in the relationship is now gone :)

Oh, and I found out my usual APR on that credit card isn't 19.9%, it's 18.9% :)