Balance transfer question

[Anonymous]

Hey guys. 

I have two cards. CSP - 28,400 CL and Amex Plat

I am carrying a 10k balance that I plan to pay off in a few months and I wanted to BT to Discover IT for the 0%.

Well my account just got setup this morning and when I logged in it says my CL is only 5500 which is not enough. I called them 

and they said I need to wait 6 months to CLI. My question is if that I cannot transfer the whole balance then I do not want another 

card. I was thinking of just cancelling the card. I know it will hit my credit but I am unsure of what to do now? How hard will it 

affect my credit?

[BornSupercharged]

In terms of paying it off, how many months is a few months?

What's your APR on the CSP?

What's the transfer fee on the discover?

If the transfer fee is < than the CSP's APR divided by 12 (mo. in year) times the # of months you would pay the balance off in, then doing a partial balance transfer makes sense. Otherwise it does not. Example, transfer fee 3%,CSP APR 15.24%, you were going to pay it off in 6months. That's 15.24 / 12 (to get monthly APR)  TIMES 6 months =  7.62% APR. So 3% < 7.62% so you save more than 50% on your interest.  

Also, Discover It is a great card to have so I recommend keeping it open regardless of whether you end up doing a partial balance transfer to it or not. 

[Anonymous]

How bad will it affect my credit if i close it?

I believe my APR is 12.99 and i would pay it off in 6 months

[BornSupercharged]

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@Anonymous wrote:

How bad will it affect my credit if i close it?

I believe my APR is 12.99 and i would pay it off in 6 months

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Its hard to say how it will affect your credit if you close it, if you only have 3 cards then yeah it could affect it because your utilization % will raise again. Honestly I'd leave it open.

You may want to check your APR because their signup says 15.24 and that's what we're at - not saying yours isn't 12.99 just you may want to double check that. 

Even at 12.99 though, assuming a 3% BT fee you're going to come out ahead. 

[Anonymous]

i see what you mean .. i just dont like how a lot of cards .. i just wanted to keep the csp and amex .. only using discover for the 0% .. but now that i cant transfer the whole amount .. it kinda seems pointless

[BornSupercharged]

You can transfer 5300, the 3% fee will add $159, so your balance on the discover it card will be 5459. 

The interest on 5300 at 15.24% APR for 6mo is $403.86*. So you COULD effectively save $244.86* by doing the balance transfer.

Moreover though, is the BT offer for 12months? If so, you could do this:

Pay $454.92 to Discover It for 12 months, and your $5,459 will be paid off when the promotion expires. 

The remaining $4700 on your CSP at 15.24% will cost you less than $358*.14 in interest if you pay it off in 6 months, or less than $716.28* if you pay it off over 1 year.

* Amortization will reduce all the amounts because as you pay principal your interest will be reduced. 

[Anonymous]

the discover is 0% over 18 months

[BornSupercharged]

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@Anonymous wrote:

the discover is 0% over 18 months

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Well even better, you can pay the $5459 off over 18months with 18 equal $303.28 payments. And focus the rest of your money on paying off the CSP balance as quickly as possible

[Anonymous]

thanks for the help .. quick question .. when would be the best time to pull my credit report .. should i wait a bit since i just opened discover or it doesnt matter ?

[BornSupercharged]

It may not have reported yet. It can take a few days to a couple months, but most of the time within 30 days it should be showing up.