nevr had a credit card before, need to raise some cash

the_root_of_all_evil

Any advice is most welcomed. i should mention i ve never had a credit card before and im a little weary of them given the press.

im trying to raise 5k for a house purchase, and im trying to do it interest free of course.

there is no problem in paying this off in a few months time but i need the cash sooner rather than later.

the answere is to open a virgin credit card first, the question is how do i get cash from it? do i draw it from the machine or bank account, maybe they send me a cheque. does that sound stupid i really haven't a clue when it comes to this.

once i have my hands on the cash i will complete the house purchase, then after a few months i would open the new alliance and Leicester card which is fee free to balance transfer as far as i can make out.

so my theory is roughly a years interest free money, but:

1. how do i get the cold hard cash from the 1st virgin credit card and is it fee free?

2. how do i transfer the balance to the new a&l card

3. once i have saved wages a few months down the line, how do i pay off the a&l balance and is there a fee for doing so?

these are probably stupid questions, but i really dont know the answers pleae help and give your opinions, and any pitfalls i may have missed.

also i dont want a bank loan, i need short term loan i can pay back almost immidiatley when ready.

another option is the bank of mum and dad, but i really dont want to go there if i can help it :eek:

co123456

You sound unsure. If you're not on the ball Stooze-wise, I suggest a little more research. Took me a while before I jumped in. To get funds fee free, you will need to incur some credit searches (let's say two). These might impact any mortgage application you may have in the near future.

I bought a car a few years back and got a loan from Natwest. When my earnings increased, I payed off the loan early without penalty. Is this an option for you?

CannyJock

the_root_of_all_evil wrote: »

1. how do i get the cold hard cash from the 1st virgin credit card and is it fee free?

2. how do i transfer the balance to the new a&l card

3. once i have saved wages a few months down the line, how do i pay off the a&l balance and is there a fee for doing so?

First disclaimer is with no credit card history you might be lucky to get a limit high enough to do what you want. You're more likely to meet the credit criteria for Bank of Mum & Dad. Before embarking on this, standard advise is to get a copy of your credit report and check everything looks good on there, you're on the electoral register etc etc - read the article "Credit Rating" above for more details.

But, if you were eligible ...

1) You ask them to when you phone to activate the cards, setup the min repayment DD and set your statement date to "yesterday". It's not fee free, currently a 4% fee and you can transfer up to 95% of your credit limit. Fee rising to 5% from 1st March.

2) You don't do this after a few months, you do this after 14 or 15 months. Virgin 0% promo is for 16 months so why waste money doing it sooner? So the answer really is that if you need the money for up to 12 months then you won't need another card at all.

3) Again, you don't. You're on the stoozing board, so the stoozing answer is you take your wages, stick them in a high interest account earning up to 6%, and then 2 weeks before your Virgin 0% promo ends, you use the money you've saved to clear the bill in full.

the_root_of_all_evil

thanks for the prompt answere CannyJock.

yes my credit rating is 100% in tact.

once i open the account i assume you get the cash from a machine.

are cash advances charged at 29.9% apr rather than 16.6% apr?

if this was the case how would this stoozing be more beneficial than a bank loan?

CannyJock

the_root_of_all_evil wrote: »

thanks for the prompt answere CannyJock.

yes my credit rating is 100% in tact.

once i open the account i assume you get the cash from a machine.

are cash advances charged at 29.9% apr rather than 16.6% apr?

if this was the case how would this stoozing be more beneficial than a bank loan?

Nope, you don't withdraw money from a cash machine. See answer 1 above.

The cards that allow you to transfer funds direct to your current account are listed http://www.stoozing.com/sbt.php

DesertFlyer

the_root_of_all_evil wrote: »

im trying to raise 5k for a house purchase

I may be wrong, as I am assuming this 5k is to help with a deposit, but don't mortgage lenders and solicitors ask where the deposit has come from and decline the application if deposits are based on personal credit?

I've heard tell of people having to pay off credit cards and/or personal loans to qualify for mortgages.

However it raises an interesting question. I have £20k+ unsecured credit available - which if I purchased a house I would still have available afterwards and could spend. Therefore why does it matter if it is used for deposit?

Or could I just ask a friend with the cash to loan me say £5k and use a 0% BT cheque to deposit the funds in an account after securing a mortgage (a bit like an off-balance sheet loan)? Presumably therootofallevil could also do this.

the_root_of_all_evil

so, in order to raise 5k off the egg money card:

1 open the account

2 transfer the money to my current account (no charge?)

3 open a&l card and do a free balance transer, were the balance will sit until i pay it off

4. ive not incurred any charges?

am i missing something?

CannyJock

the_root_of_all_evil wrote: »

so, in order to raise 5k off the egg money card:

1 open the account

2 transfer the money to my current account (no charge?)

3 open a&l card and do a free balance transer, were the balance will sit until i pay it off

4. ive not incurred any charges?

am i missing something?

Yes. Couple of things. You can only transfer from Egg Money to your current account if you have a positive balance, so you'd need to do a balance transfer to Egg Money first.

The Santander card is the one that does the 0% fee transfer if you have a current account or mortgage product with Santander or A&L. You still need to make the minimum payments each month.

Have another read at the stoozing guide before you embark on this, or you're in danger of messing it up - http://www.stoozing.com/g_stooz.htm

moneysavingmarrow

You may be better off by modifying the bank of mum and dad thing by getting them to raise the cash, with a 0% card in their name which they can transfer to your bank account, which will leave you showing no debts on credit search when you apply for your mortgage.
Should be no more risk to them, than them lending you the cash out of their savings, which may well be in some very nice high interest accounts, which were activated before the present financial climate came about.

metalfury

Alliance and Leicester do a current account with interest free overdraft for 12 Months. It's only up to £2K, but would dent into the £5K if your credit limit isn't high enough on the cards you apply for.

Research everything thoroughly first - particularly with the fast stooze as it takes a while to get your head around.

avalanche_3

On taking out a mortgage the Bank can take into account credit card debts or ask you to pay them off before they will lend you the mortgage money.

If you need the money to pay the mortgage application fees you can lend the £5000 off somebody short term till the mortgage application goes through

Then once you have been accepted for the mortgage and they have done the financial check on you take out a 0% credit card and use the money to pay off whoever lent you the £5000.

If you have enough of your own money for the application fees just wait till the mortgage company have checked your finances and take out the £5000 on a credit card before you have to pay the house deposit.

Don't apply for the credit card too early or you will be wasting part of the 0% offer.