No spend on 0% BT card?

KerryL

Why is it not recommended to spend on a 0% BT credit card, apparently it can get expensive? Can someone explain in plain english why this is please? Sorry little dense over here!!!

Simon_Preston

Because lower interest balances are paid off first leaving higher rate balances to accrue interest. So as your £2000 BT is being chipped away at, that £600 you spent getting a new TV is getting more and more expensive.
If you must make purchases on a credit card then I highly recomment you get a 2nd (or 3rd, or 4th even) card and do your spending on that. But make sure it's paid off quickly.

KerryL

Simon_Preston wrote: »

Because lower interest balances are paid off first leaving higher rate balances to accrue interest. So as your £2000 BT is being chipped away at, that £600 you spent getting a new TV is getting more and more expensive.
If you must make purchases on a credit card then I highly recomment you get a 2nd (or 3rd, or 4th even) card and do your spending on that. But make sure it's paid off quickly.

Thanks Simon, now I get it! :j

KerryL

Another quick question, when you do a BT transfer do they automatically close your old card account? Not that you'd want to spend on the old one anyway!

cally6008

What about if you get 0% on purchases for 6 months ?

I'm getting a Halifax card with 0% balance transfer for 13 months and 0% on purchases for 6 months so was planning on balance transfer from capital one card and to use it as my main card from when I get it (not that I spend much on it anyway)

Phantom_Flan_Flinger

KerryL wrote: »

Another quick question, when you do a BT transfer do they automatically close your old card account?

No, they won't. It's up to you whether you close it or not.
You may be offered a deal when you try to close the card.

On the other hand, unused cards show on your file as available credit. This may not stop you getting new cards, but it may affect what limit you get.

The usual advice is to close old cards.

Phantom_Flan_Flinger

cally6008 wrote: »

What about if you get 0% on purchases for 6 months ?

I'm getting a Halifax card with 0% balance transfer for 13 months and 0% on purchases for 6 months so was planning on balance transfer from capital one card and to use it as my main card from when I get it (not that I spend much on it anyway)

You can spend on it, but you have to be aware if you haven't cleared the BT by the end of the 6 months, your purchases will start to accrue interest at the full rate. The longer the time you take to clear the BT after that, the more interest you'll pay.

Milarky

cally6008 wrote: »

What about if you get 0% on purchases for 6 months ?

I'm getting a Halifax card with 0% balance transfer for 13 months and 0% on purchases for 6 months so was planning on balance transfer from capital one card and to use it as my main card from when I get it (not that I spend much on it anyway)

Well no you wouldn't want to do that for the obvious reason that spending is only at 0% for 6 months so, for seven months of the balance transfer period the top slice of the balance will be charged at twenty-something percent. The only time it is 'safe' to spend on a balance transfer (and purchases) card is when the purchase period is as long as the BT period. The difference of '6' and '13' is no accident. It's deliberate. Look at all those cards that offer 13 months and 3 months. It's a trap for the unwary.

cally6008

It's 17.95% afterwards on both purchases and balance transfers on the card I've got