topic Re: Personal loan or BT from Credit card??? in Personal Finance

Personal loan or BT from Credit card???

Janneman — Mon, 22 Apr 2024 12:25:29 GMT

I have a personal loan in the amount of $20k from BECU since July of last year, and I have never touched it. Is there any problem if I never touched it? I mean, if I dont take it or use it, would they cancel it up? Also, if I do want to take that loan, how to take it? I mean, how I could withdraw it?

It has 10.4 apr, do you think its good compared to credit cards BT offers that I have from many credit cards as 0% apr for 10-15 months but there is a 3%-5% fees....So, given this fees do you think its better to do BT from credit cards or personal loan with 10.4% apr but no any fees? I have never used this personal loan or BT, but thinking to use now because I do not want tons of my credit cards and this personal loan to be closed out for non-use....Please give your opinions as to what is best economical wise, personal loan or BT from credit cards with 5% fees...Thanks

Re: Personal loan or BT from Credit card???

SouthJamaica — Mon, 22 Apr 2024 12:45:01 GMT

@Janneman wrote:
I have a personal loan in the amount of $20k from BECU since July of last year, and I have never touched it. Is there any problem if I never touched it? I mean, if I dont take it or use it, would they cancel it up? Also, if I do want to take that loan, how to take it? I mean, how I could withdraw it?

It has 10.4 apr, do you think its good compared to credit cards BT offers that I have from many credit cards as 0% apr for 10-15 months but there is a 3%-5% fees....So, given this fees do you think its better to do BT from credit cards or personal loan with 10.4% apr but no any fees? I have never used this personal loan or BT, but thinking to use now because I do not want tons of my credit cards and this personal loan to be closed out for non-use....Please give your opinions as to what is best economical wise, personal loan or BT from credit cards with 5% fees...Thanks

It's not possible to have a personal loan and to not have touched it.

Do you mean a personal loan offer? If so the answer is yes, they can take it away at any time.

Do you mean a personal line of credit? If so, the answer is maybe, they can reduce it or cancel it at any time if they feel like it.

Re: Personal loan or BT from Credit card???

Janneman — Mon, 22 Apr 2024 14:30:26 GMT

@SouthJamaica

It is a personal line of credit....Last year when they approved a credit card then a day or two later a representative called me and told me that if I would wish then he could approve me for a personal loan for $20k without any other HP....I said ok...and then I received a paperwork about it in the mail which I have right in front of me now....I never used or touched it...but I did contact them 2 months back and asked them if there is any negative consequences if I will not use it for sometime more....I was told no issue....It was approved last year in the end of July.....Prior to that I have never ever used any personal loan or personal line of credit...thus I don't know how it works....

Re: Personal loan or BT from Credit card???

SouthJamaica — Mon, 22 Apr 2024 14:55:45 GMT

@Janneman wrote:
@SouthJamaica

It is a personal line of credit....Last year when they approved a credit card then a day or two later a representative called me and told me that if I would wish then he could approve me for a personal loan for $20k without any other HP....I said ok...and then I received a paperwork about it in the mail which I have right in front of me now....I never used or touched it...but I did contact them 2 months back and asked them if there is any negative consequences if I will not use it for sometime more....I was told no issue....It was approved last year in the end of July.....Prior to that I have never ever used any personal loan or personal line of credit...thus I don't know how it works....

OK so that's not a loan, it's a revolving credit line.

Usually they're ok with your not using it, and just leaving it there as a backup. But there are, of course, no guarantees.

Re: Personal loan or BT from Credit card???

Janneman — Mon, 22 Apr 2024 15:09:59 GMT

@SouthJamaica

Should I use that with 10.4% apr, or should I take out cash advance/BT from credit cards with 0% apr for 12 months but 4% fees? Which option is better financially? Tnx

Re: Personal loan or BT from Credit card???

SouthJamaica — Mon, 22 Apr 2024 20:31:35 GMT

@Janneman wrote:
@SouthJamaica

Should I use that with 10.4% apr, or should I take out cash advance/BT from credit cards with 0% apr for 12 months but 4% fees? Which option is better financially? Tnx

It depends on how long you want to hold on to it and what the minimum payments are on the balance transfer.

E.g. if you take a balance transfer for $10k, and pay a 4% balance transfer fee of $400.....

1. Pay it back in a month, and you've paid the equivalent of something like 48% APR.

2. Pay it back over 12 months, making only minumum payments of $200 a month, and you would be paying the equivalent of less than 6% if I'm not mistaken.

But in your case, it seems to me that you don't really need a balance transfer or new card, and that you don't need to use the personal line of credit. So my advice would be to just move on and forget about it.

Re: Personal loan or BT from Credit card???

Kforce — Mon, 22 Apr 2024 22:48:03 GMT

As @SouthJamaica pointed out, we have no idea why you are thinking about a BT or loan.

Both have fee's and/or interest loss.

Either can be best with the correct numbers.

Lets say you have a high interest CC with a balance of 20,000 @ 22% APR.

Your profile would allow you to move half to zero interest cards

Your new average Apr would be just over 11% because of the transfer fee's

so the 10.4% loan would be a better solution.

If you debt was on a 17% Apr credit card the BT method might be the best choice.

We have no way of providing any real suggestions with out a lot of info.

The bottom line is that both are used by many to lower loss when one has higher interest debt.

Both have pros and cons and advantages in certain situations or for a given profile.

All of which we do not know !

Re: Personal loan or BT from Credit card???

cashorcharge — Tue, 23 Apr 2024 23:41:31 GMT

I would only add to the already great advice you've gotten...like credit cards....there's nothing stopping an FI from pulling the line/account if it goes unused and while each FI will have different criteria...just like credit cards...it's good to use them once in a while.

You don't have to go overboard....transfer $50 to your active checking account and then you can pay it before it statements....some activity is better than nothing. Not a guarantee they won't still decide to pull it though (research all the people with Wells Fargo Credit Lines that WF announced they were disolving years ago and then when pressured from consumers and eventually Congress...they decided to keep the accounts open. Not everyone was using it or saved it "just in case" though it would have implications on peoples utilization and score had it gone away.)

Re: Personal loan or BT from Credit card???

Janneman — Tue, 23 Apr 2024 06:11:26 GMT

Yes, I will try to use only $50-$100 just to activate it especially when its well said that any activity is better than no activity. If I use a large portion of credit either from personal line of credit or credit cards then loss of money will be there no matter what especially when I really am not in need of those funds....Thanks everyone...Appreciated....