Credit Card (Aqua Reward)

York_Student

Hi,
I'll be starting University within September and currently researching finances to ensure that I'm using the funds as effective as possible.

I've been looking at the Aqua Reward Credit Card, which pays 3% interest/cashback upto the £100 Max. I'll have an income of £7,125 (student funding). In addition, I currently don't have any credit history.

Based upon the above, how likely will I be able to become accepted for the product above.

In addition, is there any other financial products which would suit me from September. Let me know your thoughts. Thanks.

Gromitt

They may offer you £250 or so, try them.

If it fails, then apply for the Vanquis card. If that fails also, don't apply for any more credit products.

York_Student

Ok, Thanks.

In addition, is there any further products that would suit the above?

Stuart_W

ONLY consider using the Aqua credit card for benefitting from cashback at 3%. If you are using it to borrow, then forget it. The 34.9% (or higher) interest rates completely destroys any advantage of the cashback.

You should be looking at ensuring you have a student account with the biggest available interest-free overdraft before considering interest-bearing debt. Don't be too eager to get credit, it could very easily end in tears.

Read this about student accounts.

Martin's rule of thumb for students -

Add up student loan + grants + employment earnings + money from family, and that is your income. That’s the amount you should try to budget to spend less than.

While 0% overdrafts are very useful and should help with cash-flow issues while you're a student, they’re not ever part of your income. Always remember an overdraft is a LOAN and must be repaid (its rate will jump once you graduate).

jonesMUFCforever

If you have a student account with a UK bank they should be able to tell you whether you qualify for their student credit card.#
This might give you an idea whether you are likely to be accepted without wasting a credit search.

York_Student

Stuart_W wrote: »

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I'm planning on using the credit card for all day-to-day expenses replacing all debit cards/cash/etc.

I understand that the interest/cost is high, and I've re-read the thread, although I'm certain I would be able to re-pay the balance off in full every month which wouldn't attract the high interest rates.

jonesMUFCforever wrote: »

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I've talked to an 'Customer Services Representative' at HSBC and there where unable to state whether I would be accepted, as it's due to status. Although she did state that due to that I had no previous credit history, I would be likely to be accepted for the card.

Although if I were to apply for the HSBC Student Credit Card, there would be no 3% cashback.

Scarpacci

Not to cast doubt on you, OP, but I would suggest waiting until you've been a student for a while before signing up for what could be an expensive credit account. Many students initially don't think they will end up in their overdraft or maxing out their credit card, but they often do.

If you get a student account and find you are not entering your overdraft, which would be the much cheaper and smarter way to borrow money, then might be the time to then consider the credit card.

Credit cards are not only more expensive, but if you don't have regular income (how often is student funding paid?) then you might find yourself unable to make the monthly payments. An interest-free overdraft wouldn't have that problem.

York_Student

Thanks for the warning, as the high interest rate is massive.

Although I won't be paying any interest on the credit card, as I'll be able to re-pay all this off in full and on time each month which will mean borrowing until the re-payment date.

I'll be using the card for all day-to-day spending, and this will come from student finance. The student finance funds will have to sit there in the account until the re-payment date comes along. If worst comes to worst, the re-payment will be funded via my bank overdraft, which will avoid the interest payment.

In a sense instead of transactions going out on a regular basis, the transaction will go out on my current account per month although this would be quite a large payment. I understand that you're highlighting the dangers, although it will only be used for all day-to-day expenses, which would be spent as per usual.

Plxply

Personally I'd be more worried about recent searches on your account. I'm in a similar situation although I've had a Capital One Secured Card since I turned 18 and have a small but positive credit history.

If you check the Student Account article you'll see Co-op give the largest guaranteed overdraft which will be one credit search against your account, since you're a customer of HSBC and they'll have previous conduct you might as well apply for their student account too as they do offer potentially the largest overdraft (although I doubt either of us will get it) which is a second credit search. If you put a credit card on top of that then it's three potentially within a few months or at worst one month, which could mean you are declined for student accounts which put you in a better situation as they offer a 0% overdraft.

I would personally wait until after September to apply, especially as with my insane level of budgeting I will need to be constantly dipping into my ISA and in the end an overdraft which may be what I end up living on unless I get a part time job at the same time.

callum9999

Plxply wrote: »

Personally I'd be more worried about recent searches on your account. I'm in a similar situation although I've had a Capital One Secured Card since I turned 18 and have a small but positive credit history.

If you check the Student Account article you'll see Co-op give the largest guaranteed overdraft which will be one credit search against your account, since you're a customer of HSBC and they'll have previous conduct you might as well apply for their student account too as they do offer potentially the largest overdraft (although I doubt either of us will get it) which is a second credit search. If you put a credit card on top of that then it's three potentially within a few months or at worst one month, which could mean you are declined for student accounts which put you in a better situation as they offer a 0% overdraft.

I would personally wait until after September to apply, especially as with my insane level of budgeting I will need to be constantly dipping into my ISA and in the end an overdraft which may be what I end up living on unless I get a part time job at the same time.

If you already have 2 student accounts then why the urgency to get a third? I'd personally say the huge overdraft allowance to income ratio will be far more damaging than merely having 2 credit searches anyway - particularly as I assume you will be maxing them out (otherwise why get the 3rd?). The credit search will merely tell them that you are £2k overdrawn, it won't explain to them that you have it interest free so are only using it because you can etc. (Plus credit searches are removed 1 year later, and in small amounts like this, generally ignored after 6 months).

gt94sss2

callum9999 wrote: »

If you already have 2 student accounts then why the urgency to get a third?

Worth adding that many student bank accounts include in their T&C that you are not allowed to have student accounts with other banks..

For the OP, any of the big banks is virtually guaranteed to give you a student credit card when you open a student current account with them - unless you have an adverse credit record (as opposed to no record)

If you want to try and get the cashback card, do it after you have opened your student account/credit card - but I would be surprised if a card issued to a student would have a limit of more than £500.

Regards
Sunil