0% interest on credit card for 9 months

dhaval

Hello money savers

This is my first post on this website so please excuse me if I make any mistakes. The topic I am going to ask your advice on may already have been discussed. Please let me know if it has been because I can't find it.

My friend told me that I should get one of them 0% on purchases for 9 months credit card. Spend money on this and put my salary in a savings account so I earn interest for 9 months and earn interest rather than paying the credit card bill. Once the 9 months are about to be oover, I can put full money back to save my self from any interest. Obviously, I will pay back the "minimum" amonunt that comes on bill every month.

Now I believe this has affected my credit rating because when I wanted another credit card, I thought I will get a good credit limit on this card, let alone the standard limit. To my surprise, I actually got lower than expected credit limit. This is because as per my friend, I had a credit card which I was using the way I described earlier. That means by the end of the 0% interests, I had accumulated £1200 on my credit card. So because of this I think my new credit card didn't go through perfactly. Please advice.

Clariman

Hi dhaval

Making money by exploiting 0% offers on credit cards is known as Stoozing and there is a wealth of information available on it. There is a separate discussion board about it here and an article (see "stoozing" above). There is also a dedicated stoozing website (search for "Stoozing" on google and it will be the first match). Making purchases at 0% then saving the money is known as "slow stoozing".

In answer to your question, having a debt of £1200 on one credit card is unlikely to have a significant impact on your credit rating, unless you have also made some late payments or unless you have some other debts. Each lender uses their own credit scoring and their own rules to decide whether they will give you a credit card and what credit limit they will give you. It could simply be that the card issuer you have recently applied to gives less generous limits than the first one.

Building up to £1200 on a slow stooz should not be an issue in itself. The average balance of someone who does fast stoozing on the stoozing website is about £29,000 worth of debt. At that level it does have some impact on your credit score, but some stoozers have even built up in excess of £100,000 from credit cards. Of course, they have the money sitting in a savings account so that they can immediately pay off the debts if need be.

Clariman