Best balance transfer offer for car loan?

ElGranTaco · #1 (**permalink**) 01-19-2008, 05:03 PM

Hi

I have a $13,000 loan on a car at 6.9%. My Citibank card is offering a 4.99% balance transfer for life with a transfer fee of 3% (no cap on the fee, so I'd pay $390). I owe zero on the card and obviously don't plan to use it once I make the balance transfer. Is this worth it? Is this the best offer out there?

Thanks

AMJ21 · #2 (**permalink**) 01-20-2008, 11:49 AM

Look at the big picture. If you BT the loan to a CC your monthly payment will be around +/-$390 depending on the issuer (even with no interest).

Also, you will be transferring secured debt to unsecured. This will effect FICO. What is the CL on the card? Bring the balance over 50% will effect your UT and also bring down your CS.

If you will be in the market for another car, a house, insurance, etc. it will come back to haunt you. If not, and it makes financial sense, go for it. Good luck.

ElGranTaco · #3 (**permalink**) 01-22-2008, 11:07 PM

The Credit Line on the card is $15,000. I'm currently paying $396 a month on the car loan. I don't have any plans for another car, house, or insurance. So I'm not worried about my FICO score so much as I'd like to save on paying interest. Anymore thoughts? Thanks.

Jeremy · #4 (**permalink**) 01-23-2008, 02:57 PM

I really don't think the savings on this is going to end up justifying the transfer fee or hassle. One thing you're probably not considering, is minimum payments on credit cards is 4%, so your $396 car payment is going to jump to $535.60 at least in the short term. As you pay it off that balance will drop.

If you're ok with paying the $535.60 I think you'd be better off just sending that payment to your existing car loan and paying it off faster which is going to result in less interest paid.

Jeanie · #5 (**permalink**) 01-23-2008, 04:49 PM

Very smart idea Jeremy! Awesome advice..

ElGranTaco · #6 (**permalink**) 01-23-2008, 11:33 PM

I did not know that ... it never would have entered my mind. I appreciate the input. Thanks for the great advice.

Jeanie · #7 (**permalink**) 09-20-2008, 09:18 AM

That is what "most" of us are here for!

Good Luck!

~Jeanie

Mrs. Dee · #8 (**permalink**) 10-25-2008, 04:48 AM

I made the mistake of co-signing for my son's car loan, needless to say he's not making the payments, so I am (to protect my credit). The loan was for 15,000 balance @8.5%. I have numerous offers for 0% (life of the loan) with a one time 3% transfer fee. Also my husband has a 8% home equity loan and owes about $30,000. Should I transfer both loans to my 0% offers? Or will that just cause more trouble. My husband says that his equity loan helps off set taxes. Not sure if that is as good as no interest, don't think so.

Jeanie · #9 (**permalink**) 10-25-2008, 06:44 AM

If I Were You I Would Just Do The Car Loan. That Way If Any Probs Arise The Car Will Be In Your Name.

Good Luck..
~jeanie

theWolf · #10 (**permalink**) 11-03-2008, 11:44 AM

I did what you're thinking of doing. My car loan interest rate was 12.00%. Airtran Visa sent me blank checks for 2.99% for the life of the loan. I transferred the remaining $10,000 of my car loan over to the credit card. So far things have been going well.

However, the risk are starting to bother me. One late payment and I might be screwed. Next month I'm going to start paying down the credit card more aggressively. It's the only credit card debt I have at the moment and it just makes me nervous.