Worthwhile? / How to know what credit limit I'm likely to get?

randomweasel

Hiya

Have been looking into / considering stoozing, but am unsure really if it will be worthwhile!

So far, it looks like the best easy-access savings would 3.1%, and I can apply for a 0% for 15months card from M&S

First of all I'm unsure whether to apply for the card, as I don't know if a) I'll be accepted, though according to the quick checker on the main website I'm likely to have an average credit score
b) The credit limit would make it worthwhile

Looking at the T&C's on the card it seems to imply the credit limit would be £1200, but it really doesn't seem to make this clear, it later implies this is just an "assumption" rather than an indication of what the credit limit actually is!

APR: 15.9% variable
Total amount payable £1298.90.
The total amount payable is an illustrative figure only. It and the APR are calculated based on assumptions that you spend £1,200 on Purchases at the start of the Agreement and then repay it by.....
NOTE: - This bit seems to be about AFTER the 0% ends, obviously will pay it off before then! But couldn't find any other mention of the credit limit

Using the stoozing calculator, this would make me about £50 in the year. I'm a student, so £50 isn't really to be sniffed at, but at the same time, I'm wandering if the hassle, and moreso, the risk of how being rejected might harm my chances later on?

I'm pretty organised with my money, and have money that I can access if I need to, to pay off the card, so I'm not likely to end up being penalised for not paying off the card in time. And being a full time student, I don't pay tax.
I don't have a "regular income" as such as I work as and when (but as much as possible) in the holidays, and then my student loan on top of that. But I'm not sure what kind of opinion banks take of students applying for credit cards? at the moment, I've got a shared credit card with my mum, paid off every month (and she has a high credit score) a DD for my phone bill, and my bank has offered me a credit card, though it wasn't a great offer and I don't really need it, so haven't applied for it.

Any ideas on whether I'm likely to get approved for the card, and if there's any way to tell before applying what kind of limit I'll get? If it's only a £500 limit it's really not going to be worth the hassle for the £15 it'll make! :rotfl:

Thanks (just realised how much I wrote, excuse the essay!)

Fruit_and_Nut_Case

Welcome to MSE. :wave:

• The £1200 thing is a figure that all the cards seem to use in order to make comparisons easier. I don't know if it's a figure that they've agreed on amongst themselves or whether it's mandated by a regulator.
• Generally you won't know in advance what limit you'll get, if any.
• And there's no such thing as a "shared card". Your mum will be the cardholder and will have complete responsibility for paying the bill, regardless of who makes the purchases.

randomweasel

Thanks I've been quietly lurking for awhile, but only just joined in :P

Yeah, that was the gist I was getting, that they weren't going to say in advance what kind of credit limit I'd get :-/ Don't know if it's really worth applying in that case, considering a 1200 limit wouldn't make all that much money, so anything less than that would be bordering on pointless!

And yeah, it's my mums card, but I was pretty sure she'd said she'd put me on as a shared account holder, with the idea that it would give me some link to her credit history and make it easier for me to get loans, cards etc in the future. She pays the bills, I just have the card, which I generally don't tend to use other than in emergencies! I could well be mistaken though.

The other option which I've recently thought of is to try and get my bank to increase my overdraft. I've got a student account with a max £3000, 0% overdraft, but i have to apply specially to get anything above £1000... if I could get the full amount that would probably get me more than I could on a 0% card. This is the same bank who have offered me a credit card already, so they don't seem too worried that I'll be running off with their money!

Does anyone know, would applying for the card harm my chances of getting the larger overdraft, or vice-versa?

Tixy

randomweasel wrote: »

Thanks I've been quietly lurking for awhile, but only just joined in :P

Yeah, that was the gist I was getting, that they weren't going to say in advance what kind of credit limit I'd get :-/ Don't know if it's really worth applying in that case, considering a 1200 limit wouldn't make all that much money, so anything less than that would be bordering on pointless!

And yeah, it's my mums card, but I was pretty sure she'd said she'd put me on as a shared account holder, with the idea that it would give me some link to her credit history and make it easier for me to get loans, cards etc in the future. She pays the bills, I just have the card, which I generally don't tend to use other than in emergencies! I could well be mistaken though.

The other option which I've recently thought of is to try and get my bank to increase my overdraft. I've got a student account with a max £3000, 0% overdraft, but i have to apply specially to get anything above £1000... if I could get the full amount that would probably get me more than I could on a 0% card. This is the same bank who have offered me a credit card already, so they don't seem too worried that I'll be running off with their money!

Does anyone know, would applying for the card harm my chances of getting the larger overdraft, or vice-versa?

This is a common misconception, so mother may have thought this was the case. With a joint loan /current account or mortgage you become financially linked (and affect each other's chance of credit) but a credit card cannot be joint, its only ever the main cardholders responsibility and only appears on their credit file. So that card won't be affecting or appearing on your file at all.
So it sounds like at the moment you only have your overdraft and phone bill on your credit files? is that right?

In terms of applications - lots of applications close together can cause a short term problem with getting credit, its generally advised to have no more than 3-4 applications in a 6month period), but 1 application for a card shouldn't have a major impact on increasing your overdraft.

As a student without a regular income I would guess you probably won't be accepted for the M&S 0% card.

Ben8282

If the bank that you have an account with have already offered you a credit card what credit limit did they say they would give you?

What type of 0% do you want? I assume purchases as you have no balance to transfer.

Personally I think the chance of your being accepted by M+S is very low.

You will have a supplementary card on your Mum's account which means that she allows you to use her account which she is responsible for. Although there is a joint liability, in practice if the account was not paid the credit card company would come after her, not you.

And can you please explain exactly how you intend to 'make' this money? Interest saved on purchases that you have not yet made and would have paid cash for if you did not have a credit card? How is this making money?

randomweasel

@ Tixy - that's probably what's happened then, she / we didn't realise it wouldn't be associated with my name. Thanks
So yes, only the phone bill (though this has been in place for 3-4 years now), and the overdraft, nothing else I can think of.
I was thinking they may not be too keen, since I can't show when I'm likely to earn money and when I'm not. I might try for the card just in case then, as other than for stoozing I don't really have any need for a credit card, so if I don't get it, no big deal, and I still have the overdraft

@Ben- the bank didn't tell me what credit limit they were offering, just that if I wanted the card I would be offered one. And yeah, it would be for purchases.

And yes, that is what I meant... for example something like putting my shared households gas/electric bill on the card, which my housemates would give me the money for. Said money then goes into a savings account and earns interest. The interest is then the money that I'd "make" as this is money I wouldn't have had otherwise. At the end of the 0% the money that was put into the savings account pays off the credit card bill, the interest that was earned is then left over, as it is additional to what was paid in the first place....

Ben8282

Well yes, but you won't make very much money though.

I suggest you accept the cc from the bank. Your chance of being accepted for the M+S card really is very remote.

randomweasel

No, it wouldn't be a vast amount, sadly. But then again, as I said originally, any extra money is a bonus whilst I'm not working! The card from the bank isn't a 0% card, so doesn't really help anything :P

Just thought I'd ask, see what people thought... but yeah, I haven't got any illusions about how much M&S is going to want to give me the card, probably not much!

Ben8282

You will get 0% on purchases until the payment due date of your next statement though, so if say your statement date is 1st of month and you pay the bills with the card on the 2nd, you will have until about 25th of the following month to pay so you could keep this money somewhere interest earning for about a month and a half.