Money Transfer Credit Cards, with Offset Morgage

Offset_hawk

Hi All,

I've recently started my OFFSET mortgage and I'm trying to take advantage of the facility my putting as much savings as possible.

To turbo charge the effect I am using MONEY TRANSFER credit cards, by taking the cash out of the credit card now e.g £5k however for a fee of £200 (0% for 19months).

Am I right in saying that the benefit of having 5k in the offset account now outweighs the £200 fee?

Thanks,

jonesMUFCforever

What rate is charged on the mortgage?
Are you able to pay the minimum payment on the card every month?

grumbler

Well, this obviously depends on the interest rate of your mortgage.

£200 for £5K and 19 months is about 2.4% in APR terms. In fact this 'loan' will be even more expensive because of the minimum payments that you have to make.

See Stoozing Calculator for more accurate results. I think the effect is unlikely to be 'turbo'.

saver861

In the old days of Balance Transfers, i.e. before the balance transfer fees came in, I did just exactly what you are doing. Then however, the cards that did a cash transfer e.g. MBNA did not charge any fee so it was a no brainer and I had many years of interest free mortgage

I think MBNA now charge 4% for a cash transfer so it would not be a runner. The only way you can make this work now is getting the lowest possible cash transfer fee for the longest possible time. Currently I don't think there is any on the market that makes it a viable option.

Coveredinbees!!!!

Get a 0% spend card and use that to to do your shopping and save the money in the offset account. That's the way I did it.

YorkshireBoy

saver861 wrote: »

I think MBNA now charge 4% for a cash transfer so it would not be a runner. The only way you can make this work now is getting the lowest possible cash transfer fee for the longest possible time. Currently I don't think there is any on the market that makes it a viable option.

MBNA still have some good deals, particularly if you've a poor offset rate.


Indeed, their current low rate card doesn't charge a BT/MT fee, so any debt created by MT can be immediately BTd away to one, more, or many ordinary BT cards. In fact, couple it with a Tesco/Santander card and you can even get a totally fee-free 12-23 month MT.

Wheres_My_Cashback

saver861 wrote: »

In the old days of Balance Transfers, i.e. before the balance transfer fees came in, I did just exactly what you are doing. Then however, the cards that did a cash transfer e.g. MBNA did not charge any fee so it was a no brainer and I had many years of interest free mortgage

I think MBNA now charge 4% for a cash transfer so it would not be a runner. The only way you can make this work now is getting the lowest possible cash transfer fee for the longest possible time. Currently I don't think there is any on the market that makes it a viable option.

Currently....

MBNA/VIRGIN 2% cash transfer til 31 DEC 2015
Barclaycard 1.9% cash transfer til 01 DEC 2015

They may be just for an existing customer possibly ?

saver861

YorkshireBoy wrote: »

MBNA still have some good deals, particularly if you've a poor offset rate.


Indeed, their current low rate card doesn't charge a BT/MT fee, so any debt created by MT can be immediately BTd away to one, more, or many ordinary BT cards. In fact, couple it with a Tesco/Santander card and you can even get a totally fee-free 12-23 month MT.

Well I have not looked for a while .. but about a year ago MBNA were advertising the then longest 36 months 0%. There was a fee, I can't recall how much but when I got my card they decided to only give me 24 months instead of the 36!!

At the time I calculated it was not worth doing a BT for the 24 months against the fee.

So just watch out that they dont hook you in with a long 0% period and then slice it in half on the application.

saver861

Wheres_My_Cashback wrote: »

Currently....

MBNA/VIRGIN 2% cash transfer til 31 DEC 2015
Barclaycard 1.9% cash transfer til 01 DEC 2015

They may be just for an existing customer possibly ?

You are probably right - its a while ago since I looked and it was 4% then but may well have changed now.