Car Insurance - Credit Card

robjf

robjf

robjf

Soldato
Joined
31 Oct 2003
Posts
4,577
Location
Derby, UK
Good afternoon guys,

I'm just doing the annoying task of getting insurance quotes and I've had a thought. If i was to get a credit card so i can pay the annual price (substantially cheaper than the monthly prices) and then pay monthly back to a 0% (12 months) card, it would work out almost £300 cheaper over the year, provided i pay it back over the 12 months.

Are there any disadvantages to this method? Anything i should i be aware of? How will this effect my credit rating?

Cheers,

Rob
 
It's actually a good idea and not entirely sure why more people don't do it, as long as you pay within the 12 months there isn't any reason not too!
 
It will probably improve your credit rating.

I paid mine on the credit card as buying the car cleared me out that month but paid off the balance of the card when the bill came. Got it cheaper as I paid in 1 lump sum, no interest paid.
 
How about just paying it with your debit card. :D

If you can't afford it, buy a cheaper car to insure.



*cat amongst the pigeons.
 
Thanks for the advice.

The car was given to me by my parents and it's in good nick and I like it! A 2 litre focus, it is a bit steep on insurance but as it's an estate it's very useful!

I've got a good credit rating and cancelled the card I had as I stopped using it. The insurance is £700 for the year which I could pay in 1 lump sum, but that would leave me a little tight, so spreading the cost is a far more attractive option!

Thing is I have no idea which cc company to go for, and no idea what limit they would give me! If for some reason they would only give me a £500 limit, would the insurance company let me split the cost between 2 cards, say one debit card and one credit card?
 
Well im not particularly knowledgable about Credit Cards, last time applied for a CC it was my 18th birthday and Egg gave me a £350 limit when I earnt £300 a month. I now earn about 23k so hopefully they will give me a bit more!
 
Scubascorpion said:
How about just paying it with your debit card. :D

If you can't afford it, buy a cheaper car to insure.



*cat amongst the pigeons.
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Complete balls. I can easily afford to pay my insurance up front (and it's substantial on an e92 M3 in central London) and yet I choose to pay it via 0% credit card, because it's sensible.

It's not a cat amongst the pigeons, it's more of a completely stupid observation.
 
if you're a student you'll get £1,000s..... at the expense of people who work... lol....

somebody i work with went part time and back to uni, then they gave him nearly as much on a c/c as he would ever earn in a year full time in 1 go lol....
 
If your a ML card tart then yes yes yes, it takes some commitment to chop and change cards all the time but if you have the time it's worth it, considering the interest rates insurance companies charge and you buy wisely your quids in.
 
I used this tactic for the £1500 I didn't have immediately to hand to buy a £9k car outright - I think the balance transfer fee of ~£40 is pretty cheap for a year-long loan of that size. Not sure it improves your credit rating though...I was under the impression 0% stuff was bad.
 
I doubt it has any effect at all.

If you look at your Experian report for example, it'll list the credit limit, how much you owe, whether you're on a special rate or not, and your payment history.

That is used by lenders to assess your credit worthiness - can't see it having a negative effect showing that you manage your finances effectively?
 
I'll defer to the above knowledge on 0% cards if you guys are confident, I can't remember where I got the notion that 0% cards can reduce your credit rating - probably an old radio 4 consumer report. Doesn't bother me either way, I've got far more credit than I'd ever want to use!
 
maccapacca said:
Martin Lewis likes this!
Click to expand...

Indeed

This is what I did this year. Sometimes it takes a few weeks for a credit card to arrive (depending on the company), so take this into consideration.

My renewal quote was ~£600. Phoned them up to ask about yearly payments, it dropped straight to £480.

Play.com credit card was 9 months no interest and 1% cashback (in play.com vouchers).

I just paid £100 a month until it was all paid off
 
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