Is credit card tarting over? I think it may be for me!!

lois_2

Hi,

This is my first post on the site so I hope I have got it right.

I have been a regular credit card tart for some time now and have used the money from the cards to offset my current account mortgage. However I am finding it increasing difficult to get new credit cards to transfer my balances.

I applied for a Capital One credit card in October and was knocked back. This prompted me to ckeck out my credit history with the big three credit agencies. This was fine, a couple of late payments but nothing more than that. I thought I would leave it a couple of months and then apply for an MBNA card. This has also been declined. I have until around April when my current 0% offers run out and I need to move the money again.

Is any one else out there having the same problems as I am. I am now considering paying the cards off and finding a cheap conventional mortgage instead, although I like the flexibility of the current account mortgages.

Any advice would be welcome.

Cheers

Lois

Clariman

Hi Lois - In answer to the general question - no, rate tarting is certainly not over.

This prompted me to ckeck out my credit history with the big three credit agencies. This was fine, a couple of late payments but nothing more than that.

Hi Lois - you say that your credit history was fine and seem to have ignored the effect of a couple of late payments. Late payments can have quite a big impact on your credit rating !! Put yourself in the lenders shoes. If you were going to lend some money to someone you didn't know, what would you do ? You'd ask other people who had lent that person money and ask about their experiences. If the other people said t hat the person they lent money were late in making agreed payments, what would you do ??

Have you closed your old credit cards that are no longer used ? If you don't this can have a big impact.

For a detailed description of credit-scoring and how it affects the stoozer and rate-tart, you might find this useful http://www.stoozing.com/credscore.htm

Clariman

lois_2

Hi Clariman,

I appreciate what you are saying about the late payments, but when I say a couple, I literally mean a couple over many credit cards and many years. I have, and do close down old credit cards.

Maybe I'm a little confused, I thought that the credit card companies preffered it if people where a little lax with their finances, not to the point where they don't pay any of the money back at all, but just to the piont were they can charge them £25 everytime they miss the deadline for payments, to the point were they forget to move there balances to another 0% interest card and then have to pay back all the money they believed they saved on the promotional rate.

Perhaps that's what it is perhaps I'm not lax enough, paying balances off before paying a penny in interest.

I'm unsure what to do now. The more cards I apply for the more affect it has on my credit score, but when repeatedly being turned down I can't continue to take advanatge of these 0% rates.

What would you suggest? Should I leave the CCss alone for a while, and if so how long, or should I continue applying? This method makes my mortgage cheap, without this facility of moving my mortagage out on 0% deals the rate is not so attractive.

Cheers

Lois

Clariman

Hi Lois

Two late payments in the last year or two could impact your credit score. If they are older than 2 years, then they would probably have little impact if any. A common reason for an MBNA rejection is if you have another one of their cards (e.g. Virgin, Abbey, Alliance & Leicester etc). Although they used to be happy about people having more than one, they are less keen now.

Maybe I'm a little confused, I thought that the credit card companies preffered it if people where a little lax with their finances, not to the point where they don't pay any of the money back at all, but just to the piont were they can charge them £25 everytime they miss the deadline for payments, to the point were they forget to move there balances to another 0% interest card and then have to pay back all the money they believed they saved on the promotional rate.

Yes, they want to be able to make money from you, but they want to see you abiding to the Ts & Cs that you have agreed to !! So they would be delighted if you end up having to pay them interest because you can not clear the debt on your card, but they do not like to see you missing or being late with payments. These days, MBNA will immediately end a 0% introductory period if you make one late payment i.e. you lose the 0% deal straight away !!

Take a read through the article I mentioned above. I wrote it after discussing credit scoring directly with Experian and with an industry insider who manages a lending portfolio. It is an insider's view of credit scoring and is specifically written with stoozers and rate tarts in mind. You might pick up one or two things from it.

Clariman

smartsaver

Check you are on your electrol roll as this can impact. Also have you moved or changed your current account recently??

Current account or offest mortgages are usually charge a high interest rate so you only benefit if you have huge savings or are stoozing.

vinylmusic

lois wrote:

Hi,

This is my first post on the site so I hope I have got it right.

I have been a regular credit card tart for some time now and have used the money from the cards to offset my current account mortgage. However I am finding it increasing difficult to get new credit cards to transfer my balances.

I applied for a Capital One credit card in October and was knocked back. This prompted me to ckeck out my credit history with the big three credit agencies. This was fine, a couple of late payments but nothing more than that. I thought I would leave it a couple of months and then apply for an MBNA card. This has also been declined. I have until around April when my current 0% offers run out and I need to move the money again.

Is any one else out there having the same problems as I am. I am now considering paying the cards off and finding a cheap conventional mortgage instead, although I like the flexibility of the current account mortgages.

Any advice would be welcome.

Cheers

Lois

I dont think it looks like tarting its over. I notice some cards now give 9 or 12 months at 0% but watch out for the new fees some cards are slipping in. Sainsburys and Halifax are now charging a 2% transfer fee so for a £5000 transfer thats 100 quid
I think that this is a new trend that other cards will probably follow

lois_2

Clariman,

Thanks for that, I have read the article you directed me to and I think I know where I am going wrong.

On the face of it it would appear that my credit scoring should be fanatastic, I live in my own house and have done for years, have had the same bank account for years, been on the electoral role, closed credit cards etc. However I think that I have probably overdone the stoozing thing, I have had about 10 cards in the last 12 months. When the first cards intoductory offers ran out I applied for new cards, but the credit limits weren't high enough to transfer all my balances, so I applied for more cards, all within a short space of time, and every card has the maximum amount of credit on it.

I think my plan of action should be to let my current cards promotioanl offer run their course, pay the money back close the cards and not make another credit card application for about 6 months until the dust settles, by which time my available credit will have reduced as will my borrowing and any late payments will be well beyond the 12 months period that are held on the credit reference.

I will carry on with my current account mortgage, as I reckon I have saved £2000 to £2500 in the last 2 years by stoozing upto a third of my mortage onto credit cards, I just don't think I will get as carried away next time.

Thanks

Lois

Clariman

Hi Lois - I'm glad it made sense and helped.