Credit card query

[Bakedgoods]

My car insurance is due again shortly as since I’m expecting to still pay over £1K for it I was planning on using a credit card with 0% interest rather than spending all of the money at once.

I did the same thing last year but the 0% interest has obviously expired, are there any downsides to obtaining another credit card to do the same thing in terms of credit rating or anything like that?

Cheers

 

[rallyfan1986]

I think its only if you apply for several credit cards over a short period of time that it affects your credit rating

 

[Freakbro]

My car insurance is due again shortly as since I’m expecting to still pay over £1K for it

ouch!

Age? Type of car?

I did hear some tips to making car insurance cheaper recently...one of them which really surprised me was having a named driver on the policy, especially a woman.

Might be worth looking into to see if you can shave some off that price.

 

[Ironic Namesake]

No downside really as long as you don't keep applying in case you get rejected.

I have loads of credit cards (probably 7-8 of the things) and I don't think it has any adverse effect on my credit rating

 

[Bakedgoods]

I don't have a female I can name, but do name my Dad which does drop the price.

Just turned 22, car is a Fiesta ST. Was £1.4K last year but I had only been driving a year with 1 years NCB. I still need to get some quotes etc but with 2 years NCB this year i'm expecting it to still be above £1K.

My first car was £1,800 (a 1.4 Clio as well!)

I can't see why I would be rejected for a card at all, but don't want to adversely impact my credit rating if it's likely to effect a mortgage application or similar in a few years.

 

[Ironic Namesake]

Nothing wrong with having a couple of cards , as long as you use them every now and again and avoid paying interest - it'll be good for your credit rating

 

[muon]

If you cant get a 0% purchase card, you can get a 0% balance transfer card with (3% fee) which works out quite cheap over the year.

Quite a few purchase ones here, which should be easy to get with a decent credit history.

http://www.moneysavingexpert.com/cards/best-0-credit-cards#zero

The tesco one seems simple enough.

 

[Seft]

Having lots of cards can be a bad thing. Issuers are increasingly unwilling to lend to people with large existing credit card lines. As a guideline, you'll probably start seeing your acceptance chances deteriorate when you have available credit lines in excess of half of your income.

 

[lee32uk]

Having lots of cards can be a bad thing. Issuers are increasingly unwilling to lend to people with large existing credit card lines. As a guideline, you'll probably start seeing your acceptance chances deteriorate when you have available credit lines in excess of half of your income.

Doesn't it depend on the outstanding balance on the cards though ? If he had 2 or 3 cards all with zero owing on them then surely they wouldn't refuse him ? or have i got it completely wrong

 

[Mucky_Pup]

Plus you can close the accounts when you're finished with them.

 

[MacRS4]

I've been through about 6 cards in the last year abusing their zero rate offers. I wouldn't worry too much as long as you really are on top of the debt.

When assessing people for finance companies will often use the debt-used ratio. If you have say 10k available on credit cards, and you're constantly 9k+ into it - it'll flag up as a potential issue. 10k available with reasonable running balances (Debits out, credits in) just shows that you know how to use the product and it's not necessarily a bad thing.

Incidentally, the main reason behind the 'lots of credit applications' thing is apparently due to the lag on reporting to credit reference agencies. They register the searches quickly, but not the new accounts. So if you apply for 10 cards, but only go for 1, there's no way of knowing that you didn't take all 10 until a reasonable time period has passed for the data passing to happen.

Interesting stuff credit records.

 

[Ironic Namesake]

Having lots of cards can be a bad thing. Issuers are increasingly unwilling to lend to people with large existing credit card lines. As a guideline, you'll probably start seeing your acceptance chances deteriorate when you have available credit lines in excess of half of your income.

I've never had any problems getting rejected for cards and at one point my credit limits all together were actually greater than my annual income somehow

 

[Seft]

Doesn't it depend on the outstanding balance on the cards though ? If he had 2 or 3 cards all with zero owing on them then surely they wouldn't refuse him ? or have i got it completely wrong

Outstanding balance is indeed far more important. Available line is, however, a factor too, albeit much less important. Nothing to be too worried about, but it is used in decisioning.

 

[weringo]

Having 2 wont affect it at all really, if you're making all your payments is going to help your CR more than anything. If you have a lot of cards it will affect your chances of success when applying for more debt though.