Credit Cards vs Debit Cards

Duke · 13 Oct 2010 at 15:57

http://www.moneysavingexpert.com/cards would be a good place to start.

edit: beaten!

PMKeates · 13 Oct 2010 at 15:57

sh4rk said:
I think the cashback cards are quite strict with regards to past credit histroy, earnings and length of time at current residence.

All of these I should do quite well at - perfect history, probably better than top 10%, over a decade at current residence. It seems irrational. The only thing I can think of is they have severely tightened it up for people under 25? Maybe because I live in a rubbish area?

alx · 13 Oct 2010 at 16:06

PMKeates said:
All of these I should do quite well at - perfect history, probably better than top 10%, over a decade at current residence. It seems irrational. The only thing I can think of is they have severely tightened it up for people under 25? Maybe because I live in a rubbish area?

Odd, will probably be something really minor.

Hopefully a guy called seft (forum member) will see this as he works in the industry and knows most reasons why people get rejected.

PMKeates · 13 Oct 2010 at 16:07

sh4rk said:
Odd, will probably be something really minor.

Hopefully a guy called seft (forum member) will see this as he works in the industry and knows most reasons why people get rejected.

They are apparently going to send me a letter about it. I suspect it will be a rather generic "We look for these criteria:" rather than what really let my application down. If so, I'll chase them up again!

ntg · 13 Oct 2010 at 16:14

Tesco points!

platypus · 13 Oct 2010 at 16:16

PMKeates said:
All of these I should do quite well at - perfect history, probably better than top 10%, over a decade at current residence. It seems irrational. The only thing I can think of is they have severely tightened it up for people under 25? Maybe because I live in a rubbish area?

I can't get one of those either, and would appear to tick all the boxes, no idea what their lending criteria is.

Basher · 13 Oct 2010 at 16:20

platypus said:
I can't get one of those either, and would appear to tick all the boxes, no idea what their lending criteria is.

Earnings seems to be a biggy

SMN · 13 Oct 2010 at 16:21

Thanks for all your input chaps.

So say for example you have... £1000 (nice round number) going out over the 31 day period, then you "accrue" the debt against the credit card over said 31 days, and on day 32 you get a bill for said £1000 which you then have to pay from your bank account, correct?

Tute · 13 Oct 2010 at 16:31

I won't touch CCs with a barge pole.

In fact i'd cut up my debit card if it wasn't so necessary to have (internet shopping).

It just results in far too much impulse buying for my liking, I save up some money and then blow it on something silly. Yes, I should have more self control but I just don't.

At least with my old cashpoint card I had the walk to the cashpoint to mull the purchase over and put myself off, with DC/CCs I just pay and that's it, bought!

LordSplodge · 13 Oct 2010 at 16:35

Tute said:
I won't touch CCs with a barge pole.

They are fine and as has already been mentioned have benefits. Only for those with self control though...

platypus · 13 Oct 2010 at 16:39

Basher said:
Earnings seems to be a biggy

I'm a higher rate tax payer, if they don't want my business there are plenty who do. I'm sure they'll fall over their feet to give me a card when my other halfs business is paid off and we're creaming all the profit.

Delvis · 13 Oct 2010 at 16:44

I only got one this year..no real reason

Mainly to build a credit rating...another reason is because im poor lately, so 'if' I need to buy sometihng, like my impending car insurance, i can do that and pay it off, so it'll be cheaper than doing monthly.

And anything else really with value...

Not that i've used it yet as i cant unlock the thing!

div0 · 13 Oct 2010 at 16:44

SMN said:
Thanks for all your input chaps.

So say for example you have... £1000 (nice round number) going out over the 31 day period, then you "accrue" the debt against the credit card over said 31 days, and on day 32 you get a bill for said £1000 which you then have to pay from your bank account, correct?

Basically.

Except that the bill will usually have a minimum payment due, which will only be a small percentage of the £1000. You can chose to only pay the minimum due, and the credit card company will then charge you interest on the remainder. The interest is usually quite high, and this is where most credit card companies make their money. However, if you pay off the full amount before the due date, then you usually won't incur any costs at all.

Delvis · 13 Oct 2010 at 16:46

Tute said:
I won't touch CCs with a barge pole.

In fact i'd cut up my debit card if it wasn't so necessary to have (internet shopping).

It just results in far too much impulse buying for my liking, I save up some money and then blow it on something silly. Yes, I should have more self control but I just don't.

At least with my old cashpoint card I had the walk to the cashpoint to mull the purchase over and put myself off, with DC/CCs I just pay and that's it, bought!

I never wanted one, i dont need one, i just have one for credit rating and large purchases really.

I save my money up, then spend it...i never spend money i dont have normally.

Basher · 13 Oct 2010 at 16:47

platypus said:
I'm a higher rate tax payer, if they don't want my business there are plenty who do. I'm sure they'll fall over their feet to give me a card when my other halfs business is paid off and we're creaming all the profit.

So am I, but I was refused first time around. It was only when I moved more significantly into the higher rate bracket that they wanted me.

platypus · 13 Oct 2010 at 16:50

Basher said:
So am I, but I was refused first time around. It was only when I moved more significantly into the higher rate bracket that they wanted me.

Aye well I'm not "just" in the higher bracket either. Anyway, didn't really bother me as I got a Sainsbury's one instead. Not quite as good but still decent enough for the nectar points and what have you.

PMKeates · 13 Oct 2010 at 16:52

It seems silly to set a £30,000 minimum income and then not accept people who are far beyond it (a HR tax payer is >45% beyond).

Duke · 13 Oct 2010 at 16:53

Tute said:
I won't touch CCs with a barge pole.

In fact i'd cut up my debit card if it wasn't so necessary to have (internet shopping).

It just results in far too much impulse buying for my liking, I save up some money and then blow it on something silly. Yes, I should have more self control but I just don't.

At least with my old cashpoint card I had the walk to the cashpoint to mull the purchase over and put myself off, with DC/CCs I just pay and that's it, bought!

You do know credit cards are far safe online than a debit card?

[TW]Fox · 13 Oct 2010 at 16:54

Bleek said:
Credit cards typically have three customer types, those that have money and those that don't.

Those that have money typically have large overdrafts and balance transfer the money out in to a high interest rate account for a year and minimal cost to them. If you have a good number of 0% cards with considerable overdrafts, this can be a means of generating a modest income for doing very little.

The second person requires money and therefore leans on the credit card to gain extra credit, typically for support and emergencies. They generally pay the modest balance off at the end of the month. So you have to ask yourself, it they can afford to do so, why not just scrap the card and save for a month instead? The CC can offer purchase protection, but so too can certain bank accounts.

And finally there's the abuser, the impulse buyer and those living beyond their means, the worst person to have a credit card, the worst offender for jumping cards and only paying the minimum balance but the banks love 'em.

The final point these all share is the flexibility for international purchases and spending which you can't do on a debit.

Errr this seems way off the mark, I don't know many people at all who fit into the first description.

I buy most large things on credit card and clear the balance in full every month by Direct Debit, as I'm sure many do?

Werewolf · 13 Oct 2010 at 17:43

Aye fox, that description of the three card customer types is way off.

The main reason I have a credit card is simple.
I use it online and for the added protection when buying stuff in person.

It's much safer/more convenient to use it online than my debit card, and if it's compromised my bank account is safe, I'm not stuck without access to my money and I'm not stuck waiting for the bank to investigate before getting my money back.

In person the credit card offers much better, and significantly easier to use protection if I order or buy something that either goes wrong, or the company is unable to fulfil the contract, for example buying carpets or furniture if the company goes bust between the time I order/buy the goods and the time they are delivered (or if they are damaged during delivery) I have much better protection as the card company can/will get involved under the auspices of the consumer credit act if need be*.
This is especially handy when companies are going bust on a regular basis, as without the credit card protection you potentially are right at the bottom of the pile of creditors and might be lucky to get pennies in the pound back.

*Apparently Visa debit cards have a scheme that offers similar protection as credit cards under some circumstances but it's nowhere near as easy to make a claim on, and more limited.