Stoozing - Virgin Card

sweetdaisy

Hi

This is my first post on MSE and I'm new to stoozing. I have just applied for a Virgin Credit Card (the one with 16 months 0%). They said that I can do a money transfer to my current account.

I've not 'stoozed' before but am thinking of 'stoozing' £3000-£4000 into my current account from the Virgin Card and paying the min monthly balance, then just before the 16 months expires, repay the money back onto the card.

With the £3000 I intend to put it in my savings account as we have an Offset Flexible Mortgage (with savings accounts linked to the mortgage and current account) and am hoping that by 'stoozing' I'll be paying less interest on my mortage and offsetting more money.

Does this seem sensible? I think I undersand stoozing but wanted to check with others that what I intend to do seems right. Any advice is welcome xx

CannyJock

sweetdaisy wrote: »

Does this seem sensible? I think I undersand stoozing but wanted to check with others that what I intend to do seems right. Any advice is welcome xx

Yup, makes sense if the APR works out okay.

You'll pay a 4% fee for the 16 months at 0%, so roughly 3% APR. So long as the interest in your offset mortgage is higher than 3% APR you'll save money.

You should stooze the "maximum" possible on the Virgin card, which will be 95% of your credit limit. MBNA 0% promotions run to statement dates, so when you call to activate the card, be sure to ask them to set the statement date to "yesterday" to squeeze nearly an extra month out of the deal and give time for the minimum payment DD to be in place.

You can calculate the interest you'll save if you plug the numbers into the stoozing calculator http://www.stoozing.com/calc.php

sweetdaisy

Thanks for the information xx

I just added info the the Calculator and I will save £145.66 (doesn't seem like a lot). I assume that this is how much I save over the 16 months - is this right? My offset mortgage interest rate is 3.75% and the Virgin Card has a 16 month 0% offer.

YorkshireBoy

sweetdaisy wrote: »

I just added info the the Calculator and I will save £145.66 (doesn't seem like a lot). I assume that this is how much I save over the 16 months - is this right? My offset mortgage interest rate is 3.75% and the Virgin Card has a 16 month 0% offer.

Not sure what amount you used but the £3K you quoted in your OP returns a lot less than that...

Stoozing Profit Prediction

Data entered by the user
Balance to be transferred (pounds)...... 3000
BT card interest rate (%) .............. 0
Introductory period (months) ........... 16
Balance Transfer Fee (%) ............... 4
Maximum BT Fee (pounds)................. No Maximum
Min Monthly Payment Type ............... Percentage
Min Monthly Payment Amount (% or pds) .. 1
Savings interest rate (AER %) .......... 3.75
Tax rate ............................... Not taxed or offset

Your Results
Balance Transfer Fee paid (pounds)...... 120
Stooz pot balance at end of intro ...... 2676.33
Credit card balance at end of intro .... 2656.55
Gross Profit before tax on interest .... 19.78
Tax on interest to be paid ............. 0
Your Profit (pounds).................... 19.78

Created using the Stoozing Calculator at www.stoozing.com.
Reproduced on Moneysavingexpert with permission.

CannyJock

I make the profit less than that. Have assumed 95% of 4000 limit - Fee is 4%, repayments 1%,

Stoozing Profit Prediction

Data entered by the user
Balance to be transferred (pounds)...... 3800
BT card interest rate (%) .............. 0
Introductory period (months) ........... 16
Balance Transfer Fee (%) ............... 4
Maximum BT Fee (pounds)................. No Maximum
Min Monthly Payment Type ............... Percentage
Min Monthly Payment Amount (% or pds) .. 1
Savings interest rate (AER %) .......... 3.75
Tax rate ............................... Not taxed or offset

Your Results
Balance Transfer Fee paid (pounds)...... 152
Stooz pot balance at end of intro ...... 3390.02
Credit card balance at end of intro .... 3364.96
Gross Profit before tax on interest .... 25.06
Tax on interest to be paid ............. 0
Your Profit (pounds).................... 25.06

Created using the Stoozing Calculator at www.stoozing.com.
Reproduced on Moneysavingexpert with permission.

It's the 4% fee compared to the 3.75% APR that's making it tight. You might want to consider a 0% purchase card and slow-stoozing against your offset instead? That way there's no fees to pay.

EDIT: Doh, cross-posted with YB.

sweetdaisy

Thanks. Doesn't seem worth it if my profit is only £25.06. Will have to read up on 'Slow Stoozing' to find out how I can benefit.