Consolidate debt for less with MBNA's Rate for Life Credit Card
UK consumers looking to consolidate high interest bearing debts on a new lower long-term rate can now apply for a new credit card from MBNA.
The new MBNA ‘Rate for Life' credit card offers a promotional rate of 5.9 per cent and a low handling fee of 1.5 per cent on all balance transfers made within the first 60 days of opening an account.
The new product also offers a promotional rate of 5.9 per cent on money transfers for a four per cent fee.
Michael Donald, Business Development and Commercial executive for MBNA, said: "We believe this new MBNA Rate for Life credit card is one of the best products in the UK market for helping consumers consolidate higher interest-bearing debts or pay for significant purchases - a new car or home improvements - over a longer period of time.
"There is a lack of credit cards offering long-term rates for UK customers and longer term borrowing options - for example, unsecured loans - have become more difficult for people to access.
"By launching this new Rate for Life credit card, we are enabling customers to consolidate their higher interest-bearing credit and store card balances, loans, finance agreements or overdrafts - or make those bigger purchases they want to pay off in three, four or five years or more - for a lower rate of interest, just 5.9 per cent, until they are paid off.
"With typical interest rates for a £3,000 loan from high street lenders in the UK varying from around 15.9 per cent to 25.8 per cent, the new Rate for Life credit card offers consumers a real alternative." Mr Donald added: "The card can offer certainty of cost on borrowing, no early repayment fees and flexible payments if circumstances mean customers can pay more in a particular month."
Anyone interested in learning more about the new MBNA Rate for Life credit card can visit mbna.co.uk.
Rates for this product do not change on application. Customers are either accepted for the new Rate for Life credit card product as offered with the 5.9 per cent promotional rates, or they are not.
This is a promotional offer. If a customer pays late or goes over their credit limit the 5.9 per cent promotional rates will be withdrawn and they will be charged the standard balance and money transfer rates of 18.9 per cent and 20.9 per cent respectively on all transferred amounts.
Balance transfers can be used to pay off other credit and store cards. To settle other forms of finance customers may have to make a money transfer into their current account and pay them from there. Making a money transfer to a current account then using a debit card is an alternative way to pay for goods and services; however, there will not be the same protection under the Consumer Credit Act 1974. Even with the four per cent fee, a money transfer at the 5.9 per cent promotional rate may still work out cheaper than paying with a higher interest rate credit card over the same period.
Transferring other debts to this card and paying only the minimum amount due each month may result in lower overall monthly debt repayments, but it may take longer and cost more to repay what is owed. Paying the minimum may also cost more than other forms of borrowing with fixed repayments over a fixed period. Other lenders may charge a fee for settling a loan early.