Sub97

I want to max out a credit card on 0% interest and put that money into a savings account at just over 5%. We're not talking mega money here, it just seems like money for nothing to me. I intend on paying the minimum amount off each month, so I know I won't look bad that way. But I'm slightly worried what impact havng several thousand pounds on a credit card, for the long haul, will do for my credit scoring. My mortgage is due to be renewed in the next 12 months, so I dont want to do anything that will jeapordise getting the best deal possible with this.

Any thoughts?

Cheers,

Steve

jaycee

If you make the payments on time then it will count for you not against you.
Lenders like to see a good payment pattern so your score is likely to go up.

Jason

Andrew Timmins

Many lenders subtract existing credit card commitments from your income when calculating how much they will let you borrow.

If you owed £5000 they could assume you pay 3% per month, so £150.
£150 per month is £1800 a year.
£1800 x3.5(typical lenders income multiple) is £6300.

So it could in theory knock over £6000 of the amount you can borrow.

In more general terms lenders do like to see people managing credit well. A small amount of debt on a card, paid on time every month may improve your credit score.

If you have quite a low mortgage for someone of your income this could be a good way to make a few quid. If you have a large mortgage and the loan to value is high it may restrict your options when you come to re-mortgage. Maybe it would be best to do the 0% trick after you re-mortgage.

Hope this helps,

Andrew, a mortgage broker.

Sub97

Thanks Guys. The savings account is one where you can get the momey out straight away, so providing I just do that and pay the credit card off a couple of months before I sort the next mortgage out there shouldnt be any problems then?

Cheers

Steve

davegtt

How'd u get a credit car with say a 3k limit on it transfered over to a savings acct? just a balance transfer?

apples24

iTrader: (1)

a lot of people do that but wth several cards at once

if ya open a seperate account with a cheque book and deposit all the cash from the cards ya could use that account to directly pay the min payment each month, so use there money to pay there money lol

Cider boy

The actual amount you have on your credit card is not disclosed on your credit score, the details held are of your monthly payments (more to the point that you are making the payments), doing what you are suggesting should not not harm your credit score at all!

Just interested how are planning to shift the money into a savings account though??
Any cash taken from your CC will not usually be given at the 0% rate??

Matt

Sub97

I have a credit card with Natwest that I've had for eight years. It said on my last statement that I could transfer money into other accounts with no fees attached. My plan is to transfer the money from this card into my savings account, then pay this card off (which is at the normal 16% or whatever) with my new card on 0% for 9 months.