My sister and brother in law have a single joint bank account with an arranged overdraft of £3,000 and they are, for all intents and purposes, maxed out on it. This means they are incurring charges of approximately £50 per month: £6 for an arranged overdraft and circa £45 in interest charges. This is bad enough but changes are coming which will likely increase this cost for them.
I thought a Money Transfer card would be a good option for them; for a fee of approx £120 they could clear their overdraft and pay off the card over a number of months at 0% interest. Unfortunately they were both declined.
I am wondering if I could get the Money Transfer card instead and have my sister and brother in law repay me. I earn £80,000+, I'm a homeowner, repay my credit cards in full in each month, and believe my credit score to be very good (although I haven't checked recently). Money Saving Expert's Eligibility Calculator gives me a 90% chance of being accepted for the Tesco money transfer card so I think there's a very good chance I would be accepted.
My questions are:
- Can I actually do this? Are there any legal/T&Cs reasons why I couldn't?
- Is it possible to transfer the money to a different account than my own? Even if not supported by default and the money had to be paid into my account, I assume there would be no reason why I couldn't transfer it to another account?
- How much is this likely to impact my credit score? Essentially I am taking on debt so I assume it will have a negative impact but I can't quantify by how much. For example if my credit rating is currently 800 would doing this put my score at 200? 400? 750? I appreciate the credit ratings are a bit of a black box but if anyone has any thoughts on this I would very much appreciate it.
I'm not concerned about taking on my sister and brother in law's debt, if I absolutely had to it would be manageable for me to clear it.
Any other advice you can offer would be much appreciated.