Author Topic: Balance Transfer for Existing Loan  (Read 3215 times)

FrugalRubles

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Balance Transfer for Existing Loan
« on: August 13, 2015, 10:46:50 AM »
Hello All,
I have not done any balance transfers on a credit card but am looking into it for a portion of my lady's student loans and wanted to get confirmation / feedback from you all.

She has a $15k balance on a 6.5% loan.

I have excellent credit and was looking into the Chase Slate account (found on Nerd Wallet, 2nded on the simple dollar).
This card is offering no fees for transferring a balance for the first 60 days and 0% intro APR for 15 months.

http://www.nerdwallet.com/blog/top-credit-cards/nerdwallets-best-balance-transfer-credit-cards/

Has anyone done anything similar?

Thanks in advance!




forummm

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Re: Balance Transfer for Existing Loan
« Reply #1 on: August 13, 2015, 11:09:20 AM »
Only do it if you're certain you can pay off the thing in entirety within 15 months.

Sibley

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Re: Balance Transfer for Existing Loan
« Reply #2 on: August 13, 2015, 11:29:28 AM »
as it's a student loan, if you won't pay it off during the 0% period, you could also refinance it (or try), maybe get a better rate.

bogart

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Re: Balance Transfer for Existing Loan
« Reply #3 on: August 13, 2015, 11:38:49 AM »
Besides what others have pointed out, I am not sure whether you have any legally binding relationship (i.e. marriage) with the person you are talking about or not.  If you don't, in your shoes I'd be reluctant to take on her debt unless you are willing to consider the amount transferred as a gift you are making to her (one you are making at the time of the transfer and not expecting her to return in the future).

If you're married, then I believe your debts are already shared (not 100% sure how this applies to student loans if they were taken out before you got married, but of course that's easy to check and in any case, marriage binds your financial future together legally in a way that other commitments do not), so -- sounds sensible to me.

Mississippi Mudstache

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Re: Balance Transfer for Existing Loan
« Reply #4 on: August 13, 2015, 11:43:42 AM »
I'm not averse to playing games like this, if you know good and well that you can pay it off in 15 months. I took out a $7,500 cash advance with a 1% fee ($75) to earn a $200 savings account bonus this year. Some folks wouldn't feel comfortable doing that to earn what amounted to $125, but I'm pretty organized when it comes to finances, a little arbitrage between a couple of giant financial institutions is no big deal.

FrugalRubles

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Re: Balance Transfer for Existing Loan
« Reply #5 on: August 13, 2015, 11:54:28 AM »
Only do it if you're certain you can pay off the thing in entirety within 15 months.

We can, but my lady wants to max 401k and ensure she had adequate cash in her account for living expenses.

as it's a student loan, if you won't pay it off during the 0% period, you could also refinance it (or try), maybe get a better rate.

Agreed, we were only planning on transferring what she could afford to pay.

Besides what others have pointed out, I am not sure whether you have any legally binding relationship (i.e. marriage) with the person you are talking about or not.  If you don't, in your shoes I'd be reluctant to take on her debt unless you are willing to consider the amount transferred as a gift you are making to her (one you are making at the time of the transfer and not expecting her to return in the future).

If you're married, then I believe your debts are already shared (not 100% sure how this applies to student loans if they were taken out before you got married, but of course that's easy to check and in any case, marriage binds your financial future together legally in a way that other commitments do not), so -- sounds sensible to me.

It is for my fiancÚ, so while not binding, I want to put her in the best position to pay her own debts. It's an interesting conversation that will be worth it's own topic. When we first got together, she had a large amount of student loans and we moved into an expensive apartment. 4 years and another (expensive) apartment, we are making better mutual decisions about the best use of our funds. As the higher earner in the relationship with no debt, I am happy to cover larger or the full portion of most mutual expenses, but I feel like her student loans are her responsibility. I have read different accounts on MMM about how each couple handles these responsibilities. For the time being, we have both cut down considerable portions of our consumption with the hope that she can throw more $ at her loans.

I'm not averse to playing games like this, if you know good and well that you can pay it off in 15 months. I took out a $7,500 cash advance with a 1% fee ($75) to earn a $200 savings account bonus this year. Some folks wouldn't feel comfortable doing that to earn what amounted to $125, but I'm pretty organized when it comes to finances, a little arbitrage between a couple of giant financial institutions is no big deal.

I am also very organized and try to pick off things like this on a regular basis. This website / forum has helped me cut through a lot of crap and become even more efficient.

Thanks all.

Able was I ERE

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Re: Balance Transfer for Existing Loan
« Reply #6 on: August 13, 2015, 12:23:24 PM »
If you are organized enough to keep track of it and will be able to pay it off before the end of the 0% period, then I say go for it.   I've never done it to pay off a student loan (my loans were <2%), but I have played the 0% game before for a variety of other reasons, including paying off part of my mortgage to eliminate PMI.