credit card to fund shares

deeps_10

Hi All,

I would like some advice on buying shares using a credit card. I have been thinking about doing this and would like to invest a lump sum in to the market. I have two options

1. Credit Card with % on purchases for 12 months
2. Get a loan for X amount, invest 80% and use 20% to pay back the loan.

My question is does anyone have any advice on this and also does anyone know any share dealing websites that accept credit card as a payment?

Thanks in advance,

Deeps_10

Browntoa

suspect this will be classed as a cash withdrawal

deeps_10

thanks I will post in there

PNPSUKNET

I think he missed the point, cash withdraw instead of purchase

deeps_10

Aaaahhh sorry I understand.

Cash withdraw I assume there is a limit on the amount I can cash withdraw? If so then this causes an issue. As I don't want to withdraw multiple amounts as I will get charged for this everytime,

And does cash withdraw count as a purchase, and so still qualifying for 0% for the 12 month period

thanks

Browntoa

you pay as much as 3.5 % for the cash withdrawal

Not only is the interest rate charged usually high but credit card providers also charge cash withdrawal fees. These are typically around 2% with a minimum fee of £2. Therefore, if you are withdrawing £200 on your credit card you will be charged £4 before even taking into account the interest you will pay.
Another point to consider is the order of repayments on credit cards. Most credit cards make you pay off the most expensive transactions last, so you are charged more interest. This means if you have made purchases and withdrawn cash on your credit card, you will pay off the debt for the purchases first. Also, when you use a credit card you typically get up to 56 days’ interest-free credit- this does not apply with cash withdrawals. Once again, this means you are paying dearly on interest.

http://www.moneyfacts.co.uk/article/credit-cards-cash-withdrawals.aspx

CannyJock

Virgin Money, 0% for 16 months, 4% fee for balance transferring up to 95% of your credit limit direct to your current account. Doesn't count as a "cash withdrawal" in the traditional sense. Set up a DD to repay the minimum and repay in full before your 0% period expires or you'll get stuffed for interest.

Full list of cards that allow this "super balance transfer" direct to your current account on stoozing site (supported by MSE) http://www.stoozing.com/sbt.php

Good luck, sounds like a risky venture if you ask me.

jonesMUFCforever

Stocks and shares - you should only invest what you can afford to lose IMO.
Buying them with a credit card is bonkers - what happens if the shares decline in value and you end up paying back a debt at an astronomical rate of interest!

deeps_10

As I can't find any websites that take CC, it looks like a loan is the best option.

I agree investing in shares is a risk, but that's one I am going to take and just hope that the shares prices do go up in a year

Stompa

jonesMUFCforever wrote: »

Stocks and shares - you should only invest what you can afford to lose IMO.
Buying them with a credit card is bonkers - what happens if the shares decline in value and you end up paying back a debt at an astronomical rate of interest!

Indeed, it sounds like an extremely foolish idea to me.

ILW

You will be paying about 10% per year interest. Are you confident that the shares will increase by more than that.
As a matter of interest, is this one of these dodgy boiler room offers from a cold call?