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About borrow Cash Lump Sums

Cash exchange cards, some of which don’t charge enthusiasm for more than TWO-AND-HALF YEARS, can be less expensive and more adaptable than taking an individual advance – which is the conventional first port of call for money loaning.

What are cash exchange charge cards?

So how do cash exchange cards function? The arrangements resemble adjust exchange cards (where your Mastercard obligation is changed starting with one supplier then onto the next which doesn’t charge premium) – just for this situation, the adjust is paid as money into your present record.

Like 0% adjust exchange bargains, 0% cash exchange cards charge an expense – regularly around 4% of the sum you acquire. This thinks about to around 3% for the longest 0% adjust exchange cards.

# So what are the best deals out there?

-The MBNA Platinum Credit Cardcharges a leading 0% for 31 months – that’s more than 2.5 years – on money transfers. Also offers 0% on purchases for first three months. Fee is 4%.

-Virgin Money’s Credit Card (which comes with perks including a £50 wine voucher) charges 0% for 29 months on money transfers. Also offers 0% on purchases for first six months. Fee is 4%.

MBNA’s Everyday credit card charges 0% for 21 months on money transfers BUT offers a leading 11 months at 0% on purchases. Fee is 4% (but if you are just doing a balance transfer it’s super-low at 1.5%).

-The Leeds Building Society credit card charges 0% for 24 months on money transfers. Also offers 0% on purchases for three months). Fee is 4%.

So, while you wouldn’t pay interest on your cash borrowing for these 0% durations, transferring, say, £3,000 into your current account with any of these cards would cost £120.

The brands may be different but, in fact, all these cards are issued by MBNA. They all come with high APRs too – typically18.9% (representative and variable) which kick in after the stated interest-free borrowing is up. But what if you can’t commit to clearing your debt by then?

-In this case, MBNA’s Low Rate Credit Card charges one market-leading rate on money transfers of 6.5% (variable and representative) and NO money transfer fee.

# Personal loans Vs money transfer cards

 But what about personal loans? There are some fantastic rates around at the moment which charge APRs of less than 6.5%?

You can, for example, borrow £10,000 over two years with HSBC at just 3.9% APR – and it comes with no fees.

# Money transfer cards can still be cheaper!

But here’s the rub: even if you have an excellent credit score borrowing smaller amounts is much more expensive.

Still over two years, the best deal on £3,000 borrowing for example is from Hitachi priced at7.8% APR.

And if you want to borrow just £1,000 from a mainstream lender, Sainsbury’s Bank sits top of the tables, despite charging a whopping APR of 18.4%.

So, for smaller borrowing, money transfer cards can work out a lot cheaper.

# Money transfer cards can be more flexible!

The other advantage of plastic over a loan is that it’s easier and cheaper to clear your debt as and when you want to.

You can pay off your credit card monthly – or in any sized chunk you like. But personal loans come with a set number of fixed payments and if you clear the debt early…

…you can be charged up to 58 days’ interest under the Consumer Credit Regulations 2004

… you could also be charged a one-off fee. HSBC, for example, charges one month’s interest to redeem its personal loan ahead of time.

# Cash from money transfer cards can be quicker!

Finally, if you need cash in a hurry, a money transfer card can also prove a quicker way to access it.

If you are accepted for a money transfer deal with MBNA before 4.30pm, the cash will hit your account the very next day. This can compare to a week or more with some personal loan providers.

# But beware…!

But money transfer cards which offer a 0% introductory period are ONLY beneficial if you can clear your balance within the stated time.

Fail to do this and the high interest rates that kick in could end up costing you way more than any of the loans mentioned above.

What’s more, unlike loans, APRs on credit cards are variable so COULD go up while your debt is still outstanding.

As far as the MBNA’s 6.5% Low Rate card goes, so long as you qualify for this rate (and this will depend on your credit score), it’s currently the cheapest way to borrow £3,000 over two years.

Have a balance languishing beyond that though and the best loans could start to look cheaper.