Does this stoozing work

stinky_docker

From what I've read and understand on Martin's links on the subject,I borrow £XXXXX on a 0% card,transfer it to a cash ISA or savings account for the period and pay it all back before the 0% period ends (meeting the minimum monthy payment each month which is also paying off a very small portion of the balance at 0% interest)....

My snags with it seems to be the 4% or around that handling fee/cash transfer fee, for a the actual transfer into the savings account or ISA,which will pretty much cancel out the interest gained by them.....

Is this right or have I horribly mis-understood the whole concept....????

I'm all confused.....:rolleyes:

Andy

td_007

You have understood correctly. Unfortunately, in these days of low interest rates stoozing does not look very attractive and the returns can be very low. If you get offer of no balance transfer fee plus 0% BT for a period of time (like the Virgin card a few months ago) you stand to make a bit of profit. Otherwise, you need to work out very carefully if it is worth it.

Paul_Herring

Is this right or have I horribly mis-understood the whole concept....????

Nope. You've understood perfectly.

The article(s?) was written when interest rates were higher than the balance transfer fee, and the arbitrage was at least worth doing.

The other way of doing it where you have some chance of getting some money is 'slow stoozing' where you find a card with 0% purchases and put all your normal spending on it, pay the minimum off for the duration of the 0% period, and put the balance into a savings account. Pay off what you've spent on the card near the end of the 0% period and get another 0% purchases card.

Still not likely to get too much in the way of interest these days however, but at least you won't take the BT fee hit.

0% BT's are currently only worth it for those who are paying interest on debts they can't pay off immediately where the %age on those debts is higher than the BT fee.