Credit cards

With so many 0% interest for 6 month credit card offers coming through the door, I wondered if there are any potential pitfalls with taking on a card, using the full credit limit & investing the money in a high interest account, paying back in full after six months?

Penny

I think you may find that it's not 0% on cash withdrawals, but I could be wrong Sad

Northern_Lad

As Penny suggests, most, if not all, suppliers charge full, imediate credit on cash withdrawls, oddy enough because people used to pay off their card bills by withdrawing cash from the same account. Didn't remove the debt but prevented any interest being charged.

Now, if you can find a loan that gives a 'payment break' for a few months and doesn't charge any fees for early full repayment...

Rob R

I did this with my student grants, the bonus with them being that the money is still in there making interest, but I've just found the moneysavingexpert.com article on the subject.

hedgewitch

Penny wrote:

I think you may find that it's not 0% on cash withdrawals, but I could be wrong Sad

Shop around. MBNA had a deal which included 0% on cash withdrawals. The interest rate after the deal ended was enormous, so I assumed enough people didn't plan for paying off in time to make it worthwhile for them to run the deal Sad

Rob R

I also had the same on a First Direct overdraft till they got shirty about no money going into the account Laughing

wizz

we have an aquaintance who managed to kick start what seemed to become a mini property empire by using the credit card scheme outlined in that moneysaving article. It seemed to come down to being extremely organised and ensuring that the right cards were being paid off when each of the 0% periods was over usually transferring the balance to the next 0% offer.

I understand however that the credit card companies are now quite wise to such "credit card tart" history so if you do it for too long it can start to affect the way in which the card companies view subsequent applications.

Rob R

First Direct were suspicious with my first account application, which I only applied for to get the £25 joining incentive, but they still kept sending me the offers Twisted Evil

, so I tried again when the £35 one came through the door & got it that time Laughing

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