Cashback then balance transfer

cmma01

So does this make sense or is there a catch? More to the point is this a good idea?

To help finance a replacement car for myself, I am thinking of buying it with a cash deposit amount and then putting the balance of £2500 on a new Amex Platinum Cashback Credit Card which pays 5% cashback during the first 3 months of the card's usage. The annual fee for having this card is just £25.

My plan is to then virtually immediately, transfer that £2500 balance to Barclaycard Platinum credit card - 0% for 34 months - and pay off the £2500 over the 34 months.

The Amex cashback awarded would cover the first balance transfer fee, and maybe even a future balance transfer fee if I don't get the sum paid off in 34 months. I would cancel the Amex card just before the next annual fee was due.

This means, to get 0% financing on that £2500, it would ultimately only cost me £25 for the Amex card, year 1.

I have excellent credit score so should be able to get the new cards OK.

TWO QUESTIONS:
(1) Would the 5% cashback still be paid even if the transaction and the balance transfer took place in the same week or month?

(2) How is the Amex cashback paid? If it is credit applied to the card, can this cashback amount be withdrawn from the Amex account?

thebritishbloke

The retailer will probably charge you for using a credit card, and they might not even accept american express. If you want to maximise cashback, you should pay for it all on the credit card and then pay off the amount you were going to use with your cash deposit.

You'll be charged a 2.99% transfer fee to transfer it to BarclayCard, which will be ~£75.

The cashback would still be paid regardless of how fast you paid it off, it just has to come onto your statement first.

IIRC, AmEx cashback is paid on the anniversary of you opening the account, i.e. this time next year.

cmma01

Thanks for that advice. I would need to check on whether or not the dealer would take AMEX and any fee payable for doing so.

Putting the whole thing on credit card is a good idea except that the maximum cashback deal I can find is the Amex one which has a top spend of £2500 that would be eligible.