# credit card or personal loan



## Sammie (21 Nov 2006)

Hi, I have 3K on my credit card, that I haven't used, and am trying to decide if it's better to get a personal loan for 3K from the bank rather than using my credit card.  I have to put flooring down on a new appartment I bought and buy stuff for it.  So I need 3K.  Can someone advise please?

thanks


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## momomo (21 Nov 2006)

Do you have 6 months interest free on this card?
How soon are you planning to pay off the 3k?


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## Sammie (21 Nov 2006)

Hi, I haven't transfared to anther credit card company, just managed to clear it all off.  Becuase I will have to start paying my mortgage in Jan, I will probably like to spread out the payment back of the 3k for as long as possible so I was thinking of getting a personal loan to do this over a 5 year period.  I get a christmas bonus of 3K at chrismas but I will get all of the money if I get it in vouchers otherwise if I get cash then nearly half of it is gone on tax.  I don't know what the best option is?


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## demoivre (21 Nov 2006)

Typically the APR on ccs is higher than for term loans. Depending on who your cc issuer is though you could work it in  such a way that by transferring the cc balance from issuer to issuer you pay little or no interest eg ( this example  is not meant to be exhaustive as there are other possibilities ) transfer the 3k to an UB cc at 0% for nine months, then transfer that to BOS to take advantage of their 6 months 0% period and finally to BOI gold advantage cc at 2.9% for 12 months - overall that's a fairly cheap 27 month loan. No guarantee of course that present offers will continue or that the various cc issuers will accept your application.


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## Sammie (21 Nov 2006)

But will payments work out more monthly paying off the credit card than it will do with a loan considering the personal loan will be spread out over a 5 year period?


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## momomo (21 Nov 2006)

If you want to pay off 3k over 5 years, id be going down the personal loan route, wouldnt fancy 3k off credit card debt hanging over me.


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## demoivre (21 Nov 2006)

Sammie said:


> But will payments work out more monthly paying off the credit card than it will do with a loan considering the personal loan will be spread out over a 5 year period?



Your cc repayments will probably be between 3 and 5% of the oustanding balance ( but obviously if you keep paying only the min. you will have a larger than otherwise balance to transfer to the BOI cc ) whereas the repayments on 3k over 5 years would be roughly €65 per month going the term loan route. In your op you queried  "am trying to decide if it's better to get a personal loan for 3K from the bank rather than using my credit card ".  I took " better " to mean cheaper . Generally the longer the term of the loan the lower the repayments but the more interest you will pay.


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## Emily123 (21 Nov 2006)

If I were you I'd get a loan and be done with it. You never know what unexpected costs you'll have with the new apt and so you may need to avail of your credit card unexpectedly over the next year or two.  From other discussions I've read on AAM, some mortgage providers offer unsecured loans at lower rates of interest if you have your mortgage with them so it might be worth checking your own mortgage provider.


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## Sammie (21 Nov 2006)

How much would the monthly repayments for the credit card be?  i can afford max €150 a month.


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## HotdogsFolks (21 Nov 2006)

Not trying to sound like a dick, but do you really need to go into debt over some flooring? Can you not save up for a few months and do it then?


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## Sammie (21 Nov 2006)

thanks for all your advice.  what's does a "unsecured" loan mean as apposed to a personal loan?


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## CCOVICH (21 Nov 2006)

A personal loan and an unsecured loan are generally the same thing.


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## Sammie (21 Nov 2006)

I get paid monthly and it would take some time to save.  I'm not going to look at concrete floors for any longer than i have to.  I was thinking of maybe the sales at the end of Dec and get some deals then...otherwise it'll be a while before more sales come along.....


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## Sammie (21 Nov 2006)

CCOVICH said:


> A personal loan and an unsecured loan are generally the same thing.


 

Can I pay off lump sums without being Penalised to a unsecured loan?


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## CCOVICH (21 Nov 2006)

Sammie said:


> How much would the monthly repayments for the credit card be? i can afford max €150 a month.


 

Assuming 9 months interest free, you would be talking €333 per month.

Why not get a personal loan over say 2 years as opposed to 5?


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## CCOVICH (21 Nov 2006)

Sammie said:


> Can I pay off lump sums without being Penalised to a unsecured loan?


 
Depends on the loan. Some fixed rate loans don't allow lump sum penalties. Tesco do however, and their rates are generally pretty competitive.

A fixed rate loan from [broken link removed], for 2 years, at a rate of 7.5% would cost €135 a month. Total interest is around €232 for the 2 years. A safer option than using a credit card, even if you can get away interest free on the credit card.


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## Sammie (21 Nov 2006)

Tesco refused me a while back for a loan so i won't be trying them again.  i will try my mortgage bank and my own bank and see what the best option is......i will get it over a time less than 5 years.....

thanks all for your advice, i will keep it all in mind when making a decision....


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## CCOVICH (21 Nov 2006)

In the first post, I presume you mean you have a €3,000 *limit* on your credit card, and a balance o/s of zero?

Also, when you say 'put down flooring and stuff', how much and what kind of flooring and what kind of stuff?


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## Sammie (21 Nov 2006)

CCOVICH said:


> In the first post, I presume you mean you have a €3,000 *limit* on your credit card, and a balance o/s of zero?


 
I have a limit of 3K on my CC that is correct and the balance is zero....don't understand o/s in your post..?


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## CCOVICH (21 Nov 2006)

o/s=outstanding, i.e. still be paid.


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## Sammie (21 Nov 2006)

CCOVICH said:


> Also, when you say 'put down flooring and stuff', how much and what kind of flooring and what kind of stuff?


 
semi-solid flooring/tiles/carpets...my budget is €1.5K
i've calculated that all appliances in my kitcheen should come to €1.5K

If i have cash i'm sure i will get a discount.  but if i use the CC i won't....


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## CCOVICH (21 Nov 2006)

Sammie said:


> semi-solid flooring/tiles/carpets...my budget is €1.5K
> i've calculated that all appliances in my kitcheen should come to €1.5K
> 
> If i have cash i'm sure i will get a discount. but if i use the CC i won't....


 
€1,500k for all that flooring is a bit on the optimistic side I'd say-but depends on the size of the apartment I guess.

I don't know how much discount you will get for cash v. credit card.


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## Sammie (21 Nov 2006)

CCOVICH said:


> o/s=outstanding, i.e. still be paid.


 
yes its all been cleared.....that's why i'm a bit reluctant to use it as i really want to reduce my credit card limit........and have a tighter hold of my money....


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## Sammie (21 Nov 2006)

CCOVICH said:


> €1,500k for all that flooring is a bit on the optimistic side I'd say-but depends on the size of the apartment I guess.
> 
> I don't know how much discount you will get for cash v. credit card.


 
it could mean a microwave thrown in for free or a more durable washing machine


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## brodiebabe (22 Nov 2006)

Sammie said:


> Hi, I have 3K on my credit card, that I haven't used
> 
> thanks


 
You don't have 3K I think you have zero on your account.  You will go in to a minus situation if you spend using your card.


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## sineadt (22 Nov 2006)

Are you crazy,  You will in up in a world of debt using credit cards as loans banks love you if you do that.  Go to des kelly get nice semi solid and ask someone how to put it down,  we did our own solid beach flooring cos we are poor and we love it even more because we put it down!  Go to the bank any bank will lend you 3k and spend wisely cos the bad times are cooming.... sorry to be so pesamistic but do you remember the 80s ..  

Good luck

sinead the maid


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