TheAA advertises 5.8% loans - SCAM or what?

The other possible approach here is to go for a Texaco credit card with a life -of-balance transfer at 3.9%, which is the cheapest deal going at present.

This will take some juggling to achieve. First you need to get hold of an Egg card, which allows balance transfers straight into your current account. If you want a £4,000 car, say, you get Egg to put £4,000 into you current account, pay for the car with that, and then transfer the balance off the Egg card and onto the Texaco card. Texaco then charge you 3.9% forever.

Realistically it wil take you a month or three to sort this out - you need to get hold of the latest version of your credit file, check it for accuracy, and wait for any errors to be corrected and for the 3 recent searches (2 credit card, 1 loan) to drop off. I think they disappear after about 6 months.

Once that has happened, you can apply for an Egg card, which comes with a 0% intro offer, and as that is expiring, you apply for the Texaco.

MBNA also do balance transfers into current accounts but they often charge 2% to do this, which means they are not actually 0% at all really. Their phone reps seem to have some discretion, eg they can sometimes waive it or cap it at £35 or £50.

One potential catch with this approach is that you have to pay back 3% of the balance per month, so initially the burden of repayment is going to be higher than a conventional loan - roughly you are going to be paying back about £1,200 of the £4,000 in the first year if you just make the minimum payment.

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Experian definitely keep them for 12 months; I believe Equifax keep them for around 24 months...

What I was getting at was - if it is, is it also legal for them to provide information to companies that purports to be about *your* credit status, but which you do not see, and therefore cannot necessarily correct?

Good catch; worth inquiring on this, I would say.

"Peter Ramm" wrote

Incidentally, Barclaycard does loans at 5.7%, so marginally cheaper than the AA - but it may be Barclays who are behind the AA deal. Of course the same pitfalls apply in terms of typical rate versus what you're likely to be offered.