from the day your account is opened, for 15 months, you pay no interest, just the minimum monthly payment or a larger amount to suit your own pocket. You will not pay interest on any outstanding balance until 15 months from opening the account.

If you have any outstanding balance at 15 months +1 day, you start to pay interest on it at their normal rate; purchases, cash advances and balance transfers may have different “normal” rates and they split the outstanding balance over the three as they see fit**

Some cards have X months 0% on balance transfers, Y months 0% on purchases. So if you do a balance transfer on day 1, you have X months to pay it off without paying any interest on it; if you do one on day 30, you have (X months – 30 days) interest free; likewise, if you purchase anything, you pay no interest until Y months from opening the account.

** may not be entirely true 😉

Make sure you check the “normal” APR for when the 0% finishes – if it’s much above 20%, shop around. And if you do do a balance transfer, make sure you close the original card account and destroy the original card. Do not start spending on it again, that would be a foolish thing to do, oh yes 😳

Is this the M+S card? I just got one and I got stumped by the terminology too 😆

Yes. Generally. Available credit is cumulative and therefore negative for rating unless you’ve used it and paid off it off previously (generally speaking).

HOWEVER:

Where I worked it’s “at that instant” what is your credit facility vs your earnings / risks etc. that the ratings systems looked at. So – if you run over your ideal for a while and your not looking for a mortage this week / month then its fine. Cancel them if you dont need them.

#Edit In 2 months time it wont matter a damn if you had a credit facility today that you shouldnt have – so long as you paid them on time. /#Edit.

Apologies if that’s not all totally clear – its probably designed not to be all that clear tbh.

In relation to closing accounts. I heard somewhere on that there internet that its actually better to keep a fully paid off account/card open and unused rather than close it for your credit rating. I’ve always closed mine.

What’s the best?

Having one or more credit cards improves your credit rating, as long as you always meet the minimum payment. You have a credit facility, and you are using it responsibly.

However, over the years we have built up a stack of un-used credit cards from various introductory offers, then it was mentioned to us that it would start to dent our credit history because we had so many cards, so we closed a load of the unused ones.

Finally, one of the tricks used to be that your payments paid off the balance in order of interest. i.e. you pay £50 off you balance, that £50 would pay off the balance with the lowest interest rate first, so it would pay off your new ‘interest free’ bike loan, and leave the £20 cashpoint emergency withdrawal on the statement at 30%APR. It would stay there, every month, until you cleared the bike payment. There seemed to be some sort of reform last year, and most of our card issuers sent us a letter saying that any payments would now apply to high interest items first, but we didn’t get letters from all of them. I’m sure one of our cards still pays off the low interest items first. Variations on this, are interest free balance transfer, then you do your shopping on the card, and have to pay interest on the purchase until the balance transfer is cleared, I’ve even heard of the payment protection you opted for, being debited from the card each month, and racking up the interest during an introductory offer on a balance transfer!

Be careful on the 0% transfers if you are also going to be using the card to make purchases. Often, any payments you make will first go towards paying off the debt on the lowest rate (ie. the 0% transferred stuff) meaning you will still be accruing interest on the purchases until the transfer amount is paid off.

Yep,Barclaycard.
The application said £1500 max but they gave me £5700 as my limit.

I have no intention of making any purchases so I’m not really bothered about that side of things.

I have a card to boost my credit (not that it’s bad) I worked in the industry for a while and many people are refused larger credit requests due to lack of history.
This at least means i have a history of reliable payment – even if it is only £20 a month interest free on my £600 transfer 🙂

Just be aware that you are charged different levels of interest for different transactions. So purchases may be 0% but cash withdrawals and other transactions will incur interest.

The kicker is that you pay off the lowest interest rate first, so if you have a big 0% balance and you only do the minimum payment, and you incur interest on a different type of transaction, you will continue to incur interest on it until all your 0% balance is paid.

It can end up costing you a lot, esspecially if you use it for financial transactions @ 25%+ apr.

The normal trick is probably been mentioned already but….

Initial £1500 is interest free for, say 18mths. You see a nice shiney frame for £500 and buy it on the card.

Whatever you pay off the card is coming off your interest free ‘bit’. So your £500 part is getting 20% apr applied every month until you pay off the £1500. That can ramp up pretty quickly. Even if you pay in £500 you think is covering the frame transaction it won’t be.

Use it once, then never use again if possible.