New Credit Cards While Unemployed

SteveP29

I've just been refused a credit card from Bank of Scotland.

I currently have a card with MBNA, their tie-in with Newcastle United has now ended and my new card which replaces the current one which expires at the end of this month is a plain, bog standard MBNA card.

I originally got the MBNA card because of the link up with NUFC, now that it has expired, I'm no longer interested in having it.

At the moment, I am unemployed and am paying £36 a month off the balance of £1500 I have on the account, I am paying around £20 a month in interest, so as you can see, I am only paying off £16 a month on this card.

I wanted to get a new card (the Bank of Scotland Plus card) which has 0% on balance transfers for 18 months.
I have no intention of spending anything on this card, just to use it as a way of getting the balance down in the 0% period and reduce this debt.

I have budgeted on paying £50 a month, which, by the end of the 0% period, would have paid off nearly 2/3 of the balance.

My question being, I know that I am not entitled to receiving credit like this, but why should I be penalised and used by MBNA as a money making exercise, when I could use the money available to me each month in a more constructive way?

Tixy

No new lender is going to want to give you a card whilst unemployed. You might spend all of that limit as well as all of your limit on your existing card. They won't see how you could afford to service the potential debt you could run up and the debt on your existing card.

And bank of scotland would rather not risk you defaulting on a debt to them and would much rather you defaulted on a debt with MBNA (and being unemployed puts you at a much greater risk of defaulting statistically).

cajef

SteveP29 wrote: »

why should I be penalised and used by MBNA as a money making exercise, when I could use the money available to me each month in a more constructive way?

Maybe because when you used £1500 of their money you agreed to pay it back as per their terms and conditions.

YorkshireBoy

SteveP29 wrote: »

am paying £36 a month off the balance of £1500 I have on the account

I have budgeted on paying £50 a month, which, by the end of the 0% period

Your logic is lost on me I'm afraid.

Why would you want to repay a 0% card quicker than you would a circa 17% card?

Even if you do get a card elsewhere (not necessarily with HBoS, whose minimum payment, like MBNA's, is 1% + interest), you could be forced into paying £45 without a say in the matter if the card has 3% minimum payments.

SteveP29

YorkshireBoy wrote: »

Your logic is lost on me I'm afraid.

Why would you want to repay a 0% card quicker than you would a circa 17% card?

Even if you do get a card elsewhere (not necessarily with HBoS, whose minimum payment, like MBNA's, is 1% + interest), you could be forced into paying £45 without a say in the matter if the card has 3% minimum payments.

Have I been picking this up wrong then?
As far as I was aware, taking a card with a 0% transfer meant that after paying the initial transfer fee (which with the Bank of Scotland card was 3%), I'd be paying £50 off the balance each month.

Am I right in saying that this is not the case and I would be paying £45 a month each month?

I want to pay off the debt owed, whether it be on a 17% card or a 0% card as quickly as possible, and my logic is that by not paying any interest (with the 0% card) I'd be paying off the debt much quicker.

SteveP29

Tixy wrote: »

You might spend all of that limit as well as all of your limit on your existing card.

The intention was to close the MBNA account and destroy the card once I'd got the Bank of Scotland card and transferred the balance, to prevent me fromspending anything on it. But I do appreciate what you're saying.

jonesMUFCforever

SteveP29 wrote: »

I've just been refused a credit card from Bank of Scotland.


My question being, I know that I am not entitled to receiving credit like this, but why should I be penalised and used by MBNA as a money making exercise, when I could use the money available to me each month in a more constructive way?

You spent it - that is the reason you are now in debt.
Did you have PPI?

Wallhart

You dont have a right to just transfer willy nilly so that you don't pay interest. The banks have a cost of capital providing you with credit and yet charge you 0% for the privalige. Why do so many people not get this.

Unfortunately for you is that you are unemployed so it is going to be near on impossible to get a 0% deal so you may be stuck having to pay the bank for the privalige of borrowing money. I know you are probably trying but you should really do anything to earn a little bit of momey to help repay it as soon as possible. Do you have anything you could sell to help.

Degenerate

SteveP29 wrote: »

The intention was to close the MBNA account and destroy the card once I'd got the Bank of Scotland card and transferred the balance, to prevent me fromspending anything on it. But I do appreciate what you're saying.

Tixy was talking about lender's risk assessment, not your intentions.

chuckley

U r not serious....

SteveP29

I've thankfully managed to find myself employment.
I start the job on 10th October.

How long would you all advise to wait until I apply for this card again?

Thanks!