Society One - anyone have any experience?

[wakychapmans]

looking to consolidate two credit cards.

https://www.societyone.com.au/

Anyone have any experience with them? or know anyone that has?

[trevc]

Sorry no experience.
Out of curiosity what interest rate are they offering vs your current lender(s)?

Trev

[scblack]

No experience with them, so can't comment. But I am a CPA accountant with many years financial management experience.

If you are looking to eliminate two credit cards, do you have a decent household budget in place? Are you going to cancel the two credit cards?

Sorry not judging you there, but if you have racked up two credit card debts, you may have to change your spending habits to ensure the same does not happen again.

[wakychapmans]

hey scblack...

many years of no budget have led to where we are now.

We've had a budget in place for over almost a year now. Credit cards are happily sleeping in the freezer. As we pay them down, we reduce the credit limit.

But the temptation is still there, so I'd prefer to get a single personal loan, pay it out and retire the cards completely.

thanks for the advice though.

[scblack]

 To get a loan to cancel the cards, that sounds sensible.

Unfortunately too many people take out a loan to pay off credit cards, but then continue to rack up new credit card balances, defeating their goals.

Good luck with it.

[BaseCamp]

Hey mate....   have you looked at one of those balance transfer  credit cards like HSBC and many others have that offer zero interest for say 6 or 12 months?

Of course these dogs offer it with the hope of ensnaring you with more debt.....   but if you literally chop up and bin the card on receipt and use the extra cash not needed to otherwise pay extortion interest rates to slap down the debt load -- its a good chance to get ahead. ....

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[wakychapmans]

Hey mate....   have you looked at one of those balance transfer  credit cards like HSBC and many others have that offer zero interest for say 6 or 12 months?
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Basecamp - I've looked at it many times. The catch is that at the end of the interest free period. the rate reverts to (usually) 21%... or worse.

and to be brutally honest... most of them won't do a transfer for the larger Combank card outstanding. (you don't want to know... trust me)

With a personal loan... I can get them all paid out inside 2 years with a tight budget. Then... a used Tvan.

[Nomad]

Hey mate,

Don't know if you own a home / have a mortgage but if you do it may be worth transferring the debt to it. Now I definitely don't advocate this if your going out to buy a car or something, short term asset and long term loan etc etc, but if you can calculate what you would pay on a personal loan and can make the equivalent payment on top of your home loan you will pay it off faster. Your home loan rate will be better than any personal loan rate you can get.

BUT you have to be diligent and pay it off as an extra or it will end up costing you as much or more than the credit card.

Cheers Nomad

[tripwire65]

Go get a st george balance transfer card they have 20 months interest free atm and you can combine multiple cards. I just combined 3 onto this new card.

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[arjay]

Sent all the paperwork in some months ago - still waiting for a reply.
I think they like nice simple applications - when you work for yourself, different storey.
Good luck with that

[Apples69]

Please read the fine print on all zero interest cards
If you use them right they are good but the zero interest usual applies to debt transferred and not on new purchases
Payments made are placed against the zero debt part first so once again it can become a vicious circle if you still use it
Transfer the debt get a very low limit on another card your can payout each month and work out how many pays go into the interest free term they are offering and make sure you make them
Better still get a visa debit card so you still have credit card capability but using your own cash

[Goose]

FWIW i've never heard of society one and they seem a fairly young company. Suggest reading around online about them but to be fair, the only reviews you come across with lenders will likely be bad ones... so its hard to say what you experience might be like. I think you would need a good handle on their fees and penalties (for late payment, non payment etc) to get an idea of what they will be like culturally with their customers. I notice there is about a 2% gap between their advertised rate and their comparison rate, not sure if that means something but it might be worth looking into.

I'd suggest you only borrow money from a non credit card source and you seem to have that idea already, which is great. Ideally a mortgage offers lowest interest rates but a personal loan might be acceptable. There are plenty of mortgages out there under 5% right now. Some even close to 4.4%. Our bank is offering 5 years fixed at 4.8%.

Once you have squared off this credit debt, close them for good and get a visa debit instead. My household has not held a credit card since 2011. It's been great. Visa debit is accepted everywhere and you can only spend what you've already earned. The trick then is just to adapt to the new circumstances, budget, save what you can and never take out another credit card.

[scblack]

For those suggesting Mortgage drawdowns as a method of paying off your credit cards, please let me give you some advice Murucycles.

While a mortgage has a low interest rate compared to other debt, that mortgage balance is outstanding for up to 30years.

IF a person pays the extra amounts above their normal mortgage repayments, it could be argued as a good move. Unfortunately many people do not have that discipline. Many people buy cars due to the lower interest rate on a mortgage, but over time, the payments are just bundled into the normal mortgage payment, and additional payments required are not made, costing them a great deal of interest repayments over many years. If the balance sits on your mortgage, that means you are paying TRIPLE the credit card balance over the course of 25-30years.

While a personal loan, or interest free credit card may have higher headline rates, its paid off quickly, and does not add to interest payments for many years.

Please people be careful of suggestions to add debts to a mortgage - it requires genuine discipline to clear the additional payments correctly, otherwise costs you a great deal more than any other form of debt.

[Goose]

Good points and yes sorry i should have been a bit more precise. If you're moving the credit card debt onto the mortgage, you need to continue your normal mortgage repayments, plus make additional aggressive mortgage repayments on top, equivalent to what you would have or should have paid on the former credit card. That might be in the order of $500 to $1000 a month in order to bring down a $15,000 debt within a few years.

For it to be effective on the mortgage, you will need:

-- Sufficient equity in your home  such as the new credit card debt doesn't make your loan
-- Good standing with your bank regarding your mortgage repayments
-- A mortgage that allows for regular unpenalised extra payments, typically a variable rate loan
-- Discipline to make those extra payments and discipline not to draw those extra payments back off the redraw account
-- Discipline to close the credit cards
-- You'll also probably have application fees with changing your mortgage
-- Lastly if you're locked into a fix rate and have a few years to go you can incur big fees for breaking/changing the mortgage when locked

Definitely agree with scblack don't just put it on the mortgage and ignore it....

[Fizzie]

Please people be careful of suggestions to add debts to a mortgage

Was having this conversation with a mate just a little while ago & he was going crook about his (adult) son & DiL.

They took out a mortgage 10 years ago & were paying it off OK, when the car died. That's OK, we'll just do a re-draw on the mortgage & pay for it that way.

Bit later: "Honey, I've just been to see Fred & Mary's reno'ed house & their re-built kitchen looks sooooo good" Yeah, lets do our's up with a redraw...

But now that we've done the kitchen, the living room looks so dated & shabby & all our entertainment gear is getting old ...

& 4 of our friends are going to the US for a holiday - why don't we go with them? ...

End of the story, he was going crook that 10 years after taking out their mortgage, the kids now owed more on it than they did at the start, & they've used up 10 years of repayment time 

Re-draw may sound handy, but it's a scary concept as well

[Apples69]

 if putting credit cards onto home loans then set up separate loan over say five years or 3 years but like previously advised not 30 years.
Just pull out your credit card statement as they now advise how much the minimum payment will cost you - pretty scary Shit