Pondering using credit card for the first time for home renovation

phil_b_2

Hi all,

I'm in a position where I could really do to push on with some house renovation works (in advance of winter!), and an extra £2k would really help out. I have that sum or more due to be paid in by clients in the near future but a new boiler is required (+ kitchen/cooker...).

I've been looking at the tesco 0% for 16 months card as an example.

Am I right in thinking I could just get that, do an immediate transfer over to my current account for around £2k, then set up a standing order to the credit card for £125 per month and not have to worry about interest problems? Is there usually early-repayment penalties on these cards?

It's essentially an interest free loan but almost seems too simple (beyond getting approved of course).

I'm generally very debt-averse, but needs must.

Hooloovoo

You could do that, but there will no doubt be a balance transfer fee to pay of around 1.5% to 3%.

Better would be to just get the new boiler as a direct purchase on the card.

phil_b_2

I could really do to have the money ready to spend as I wish (and as cash where necessary). Also, Shifting a rounded chunk of say £2k, rather than in blocks over a couple of months makes organising a fixed monthly standing order to cover it more straight forward.

I could swallow a small charge for the convenience, but would have to find out exactly what it would be I guess.

Cheers

CLAPTON

does the tesco's card allow a balance transfer to your bank account?

phil_b_2

CLAPTON wrote: »

does the tesco's card allow a balance transfer to your bank account?

I just rang and asked and they seem pretty against it. It has a fee and you can only transfer 30% of your limit.

It would be ok if I had a £6k limit as I'd only transfer 2k anyway. Not ideal though.

I think just making the purchases on the card might be the only way.

CLAPTON

do remembe that if you get a 0% purchase card you can use the card for all your normal spending and hence free up money for the renovation works .. a bit slower but may work in your circumstances

jamesd

Check whether you can pay Council Tax with a credit card. That's a potential way to accumulate borrowing on the Tesco card. And/or the Council Tax of friends in exchange for cash to help you out.

For the Tesco card, set up a direct debit, then you have the Direct Debit Guarantee to protect you if something goes wrong, unlike with a standing order. You can pay more whenever you like but a DD for the minimum is almost essential rpotection against ever missing a minimum payment.