Simple Interest Loan to pay off credit cards?

tntsmomie · **10-5-2009, 3:07 PM**

Got a call today from one of the people with Wells Fargo. I was a bit taken aback, but we do have our car loan through the company, so it did make sense.
But essentially, he was offering us what he called a "simple interest revolving loan" to help us consolidate our higher interest and bigger payment credit cards.
We're in the process of trying to pay off our credit cards debts anyway, so he's crunching the numbers and coming up with a proposal for us that we should see in a meeting with him tomorrow evening.

Anyone ever do this type of loan? Any comments, suggestions? Tips/Advice?? Is this a good or bad thing to do?

**Rockfordmom** · **10-6-2009, 9:43 AM**

How would it be different from any other revolving loan? Any different than a second mortgage and using it to pay off your debt? Or any different than a lower interest rate credit card to pay off a higher one? I'd get information from those other sources and compare rates before you sign with them.

What I've always heard is that those type of loans can be good if you acutally use the loan to do what you plan and cut up the credit cards that you are paying off and don't use them. A lot of people get the loan, and use some of the $$ for something else or pay off their credit cards and then start running them up again. So now you have a consolidation loan payment plus your credit card payments and end up in trouble!

AndreaInNC · **10-6-2009, 10:20 AM**

being a news Wells Fargo customer - I cannot tell you how many times they have called my house since they bought my mortgage. I will flip thru my caller ID only to find that they will call me hourly and never leave a message. Finally I asked to be put on their do not call list and the calls have stopped.

I'd steer clear of a revolving loan. Remember, they are a company who want to MAKE MONEY!

If you have to get a loan to pay of your credit card debit - I'd go for the 2nd mortgage - you might be able to deduct the interest off of that loan from your taxes.

kranky · **10-6-2009, 11:25 AM**

A "simple interest" loan is a good thing - you only pay interest on the balance for the time you borrow it. The key question is whether it is secured or not.

If it's a simple interest, unsecured loan with payments you can handle and it's a lower interest rate than you're paying now on your credit cards, that seems like a winner. But always read the entire offer because sometimes those fine print details can be a killer!

AndreaInNC · **10-6-2009, 11:55 AM**

the "revolving" part is what scared me.

tntsmomie · **10-6-2009, 6:44 PM**

I spoke with the gentleman today and cancelled our appointment we had this evening. I really want to do some more research on this. It was a weird call and very "out of the blue."

We would definitely use them to pay off the cards and no longer use them. In fact, they said they'd pay the credit companies directly if we'd like.
But on the other hand, and this may sound funny, but I kinda want to pay them off ourselves. It's been a goal and I just want to pay them off, no help...kinda like -- we did it!, you know? Is that stupid? Or should we utilize what tools we have at our disposal? We're making some headway, but have gotten notices recently that for no apparent reason, our cards' APRs are being hiked to a ridiculously high rate.

kranky · **10-6-2009, 6:49 PM**

If you use a lower interest loan to pay off high interest credit cards, then pay back the new loan, you still did it yourself. You just found a more economical way to achieve it. I would not pay more interest for no good reason.

Just ask all the questions you want until you are satisfied you fully understand the terms of the new loan.

**Rockfordmom** · **10-8-2009, 8:44 AM**

Quote:

Originally Posted by tntsmomie

I really want to do some more research on this. It was a weird call and very "out of the blue."

Have you never had someone call you and try to sell you something before? That's all it is, and if you're on the "do not call list" they are not included in that because you are a customer of theirs now with your car loan. They have a loan with you and are just trying to get another.

A lot of credit cards are raising their rates lately not even because someone's credit score changed, but for reasons like the amount you owe compared to your limit on that card.

AndreaInNC · **10-8-2009, 12:08 PM**

Quote:

Originally Posted by Rockfordmom

Have you never had someone call you and try to sell you something before? That's all it is, and if you're on the "do not call list" they are not included in that because you are a customer of theirs now with your car loan. They have a loan with you and are just trying to get another.

Wells fargo is really bad about hounding you .. I had to threaten to take my mortgage elsewhere unless they stopped calling - and surprisingly they haven't called me since.

tntsmomie · **10-9-2009, 2:08 PM**

Quote:

Originally Posted by Rockfordmom

Have you never had someone call you and try to sell you something before? That's all it is, and if you're on the "do not call list" they are not included in that because you are a customer of theirs now with your car loan. They have a loan with you and are just trying to get another.

A lot of credit cards are raising their rates lately not even because someone's credit score changed, but for reasons like the amount you owe compared to your limit on that card.

Yes, we've had people call to sell us things before.
It was simply the manner this gentleman spoke to me -- like he knew me personally, that put me off a bit.
I don't mind calls b/c I can always say no. And I completely understand that being a current customer, they simply want more business from us. No problems there.
I understand their motives, but never having taken out a loan like this, I thought I'd ask.

**Rockfordmom** · **10-9-2009, 8:22 PM**

Quote:

Originally Posted by tntsmomie

It was simply the manner this gentleman spoke to me -- like he knew me personally, that put me off a bit.

I hate those the most!!! I want to ask them - do I f-ing know you? But I never do...

momlori · **11-4-2009, 8:44 PM**

I have had the same call. It seems like they will give you a loan at a fixed rate and fixed term to pay and the interest is lower than the credit card they are talking about paying off. This way they get the interest intead of the other company. I even called the credit card bank to ask about lowering interest and they were absolutley not! As this would involve moving my car loan as well, what are your thoughts?

tntsmomie · **11-5-2009, 10:04 AM**

Well, I think ultimately, if the interest rate is lower, you're in good shape. That's what I've gotten from the above advice.
We've called the CC companies, too. They won't budge either. They say to either accept the higher rate or cancel the card. We're paying the darn things off!

10-5-2009, 3:07 PM	#1
tntsmomie Every Day is a New Beginning Joined: Oct 2007 Location: VA Posts: 1,082	Got a call today from one of the people with Wells Fargo. I was a bit taken aback, but we do have our car loan through the company, so it did make sense. But essentially, he was offering us what he called a "simple interest revolving loan" to help us consolidate our higher interest and bigger payment credit cards. We're in the process of trying to pay off our credit cards debts anyway, so he's crunching the numbers and coming up with a proposal for us that we should see in a meeting with him tomorrow evening. Anyone ever do this type of loan? Any comments, suggestions? Tips/Advice?? Is this a good or bad thing to do? __________________ "Be who you are and say what you feel, because those who mind don't matter and those who matter don't mind". Dr. Seuss

10-6-2009, 11:25 AM	#4
kranky The Incredible Dullboy Joined: Apr 2005 Location: Weenie Hut Jr.'s. Posts: 2,664	A "simple interest" loan is a good thing - you only pay interest on the balance for the time you borrow it. The key question is whether it is secured or not. If it's a simple interest, unsecured loan with payments you can handle and it's a lower interest rate than you're paying now on your credit cards, that seems like a winner. But always read the entire offer because sometimes those fine print details can be a killer! __________________ Great thoughts speak only to the thoughtful mind, but great actions speak to all mankind.

10-6-2009, 6:44 PM	#6
tntsmomie Every Day is a New Beginning Joined: Oct 2007 Location: VA Posts: 1,082	I spoke with the gentleman today and cancelled our appointment we had this evening. I really want to do some more research on this. It was a weird call and very "out of the blue." We would definitely use them to pay off the cards and no longer use them. In fact, they said they'd pay the credit companies directly if we'd like. But on the other hand, and this may sound funny, but I kinda want to pay them off ourselves. It's been a goal and I just want to pay them off, no help...kinda like -- we did it!, you know? Is that stupid? Or should we utilize what tools we have at our disposal? We're making some headway, but have gotten notices recently that for no apparent reason, our cards' APRs are being hiked to a ridiculously high rate. __________________ "Be who you are and say what you feel, because those who mind don't matter and those who matter don't mind". Dr. Seuss

10-6-2009, 6:49 PM	#7
kranky The Incredible Dullboy Joined: Apr 2005 Location: Weenie Hut Jr.'s. Posts: 2,664	If you use a lower interest loan to pay off high interest credit cards, then pay back the new loan, you still did it yourself. You just found a more economical way to achieve it. I would not pay more interest for no good reason. Just ask all the questions you want until you are satisfied you fully understand the terms of the new loan. __________________ Great thoughts speak only to the thoughtful mind, but great actions speak to all mankind.

11-5-2009, 10:04 AM	#13
tntsmomie Every Day is a New Beginning Joined: Oct 2007 Location: VA Posts: 1,082	Well, I think ultimately, if the interest rate is lower, you're in good shape. That's what I've gotten from the above advice. We've called the CC companies, too. They won't budge either. They say to either accept the higher rate or cancel the card. We're paying the darn things off! __________________ "Be who you are and say what you feel, because those who mind don't matter and those who matter don't mind". Dr. Seuss

10-6-2009, 9:43 AM	#2
Rockfordmom Black Friday Mod Joined: Jan 2006 Location: Rockford, IL Posts: 5,717	How would it be different from any other revolving loan? Any different than a second mortgage and using it to pay off your debt? Or any different than a lower interest rate credit card to pay off a higher one? I'd get information from those other sources and compare rates before you sign with them. What I've always heard is that those type of loans can be good if you acutally use the loan to do what you plan and cut up the credit cards that you are paying off and don't use them. A lot of people get the loan, and use some of the $$ for something else or pay off their credit cards and then start running them up again. So now you have a consolidation loan payment plus your credit card payments and end up in trouble!

10-6-2009, 10:20 AM	#3
AndreaInNC Marching Band Mom! Joined: Nov 2005 Location: Apex NC Posts: 4,185	being a news Wells Fargo customer - I cannot tell you how many times they have called my house since they bought my mortgage. I will flip thru my caller ID only to find that they will call me hourly and never leave a message. Finally I asked to be put on their do not call list and the calls have stopped. I'd steer clear of a revolving loan. Remember, they are a company who want to MAKE MONEY! If you have to get a loan to pay of your credit card debit - I'd go for the 2nd mortgage - you might be able to deduct the interest off of that loan from your taxes.

10-6-2009, 11:55 AM	#5
AndreaInNC Marching Band Mom! Joined: Nov 2005 Location: Apex NC Posts: 4,185	the "revolving" part is what scared me.

11-4-2009, 8:44 PM	#12
momlori Toes in the sand book in hand Joined: Oct 2008 Location: Covina, CA Posts: 267	I have had the same call. It seems like they will give you a loan at a fixed rate and fixed term to pay and the interest is lower than the credit card they are talking about paying off. This way they get the interest intead of the other company. I even called the credit card bank to ask about lowering interest and they were absolutley not! As this would involve moving my car loan as well, what are your thoughts?