Halifax Clarity credit card - will withdrawing cash abroad affect my credit score?

flipperg22

I've recently got myself a Halifax Clarity credit card specifically for a forthcoming holiday to Majorca, as it appears to be the cheapest way to access foreign currency.

I just wanted to check the situation regarding withdrawing cash on the card and whether that will adversely affect my credit score. Throughout the MSE site, we're consistently told not to withdraw cash on a credit card as it impacts badly on credit scores - so clearly MSE recommending using this card for cash abroad is rather a contradiction.

I'm intending to pay off the Clarity card immediately that I'm home a week later (ideally during the holiday if I can get online). I know that I'll be charged pennies for the interest if I pay quickly (as the card charges interest immediately for cash withdrawals), but will paying quicker also be better for my credit score? My score is currently excellent, but I don't want to risk worsening it just so that I can save a couple of quid on not having to buy foreign currency in the more traditional way.

jennifernil

We have had the Clarity card, one account each in fact, since it started and use it for getting cash abroad about 3 months each year.

Doesn't seem to have made any difference to us as we have since had 2 x 0% spend cards with high (£8k+) credit limits, and Halifax have increased our Clarity limits twice.

We have DDs set up to pay all our CCs, and do not bother with paying off cash withdrawals early. The savings are not huge as the interest charged is only about £1 per month per £100 withdrawn.

We never withdraw cash from the card in UK.

Nasqueron

Credit scores are worthless and meaningless, nobody but you sees them. If you are paying for a service then please save yourself money and cancel it - no lender will ever see that score and it will never be used as part of any application, only what is on the report and you can get the report on demand for £2.

MSE more likely advises against taking cash out on a credit card as you pay interest on it in many accounts - so cards like the Clarity are the preferred choice

Thrugelmir

flipperg22 wrote: »

Throughout the MSE site, we're consistently told not to withdraw cash on a credit card as it impacts badly on credit scores - so clearly MSE recommending using this card for cash abroad is rather a contradiction.

Depends on activity levels. Common sense makes allowance for occasional events.

PaulW922

The facility exists for card companies to report back the cash advances taken each month. Some use it, some don't. Assuming Halifax does, it is only an issue if you are applying for more/new credit.

Each lender assesses credit scores in their own way. The Experian/Equifax score they provide, whilst I do not agree that it is meaningless, is purely a 'broad brush' guide for you and nobody else. Some will take note and others will not be too interested. I would suggest that whilst taking a lot of cash advances will not look good, a few every now and then will not matter - what is more important is that you use the card and pay back the debt - if the cash advances are effectively being used to sustain a a similar end of month balance that would have a negative effect because you would effectively be paying the card off with a cash advance, but otherwise given the us you intend to put the card to, I would not worry too much.

AceCobra1

Nasqueron wrote: »

Credit scores are worthless and meaningless, nobody but you sees them. If you are paying for a service then please save yourself money and cancel it - no lender will ever see that score

So basically as long as all your bills and credit cards are paid for every month, it is good to a lender? Is credit scores the score at which the company rates you at and that lenders will have a different "scoring" system?

boo_star

AceCobra1 wrote: »

So basically as long as all your bills and credit cards are paid for every month, it is good to a lender?

That a positive, yes but there are other factors such as credit utilisation, credit to income ratio etc.

Is credit scores the score at which the company rates you at and that lenders will have a different "scoring" system?

Lenders have their own scoring systems, using different weightings for positive and negative factors depending on the lender and their commercial needs.

Nasqueron

AceCobra1 wrote: »

So basically as long as all your bills and credit cards are paid for every month, it is good to a lender? Is credit scores the score at which the company rates you at and that lenders will have a different "scoring" system?

As boo_star has said, if you are paying off your bills in full every month it shows you are a good customer and lenders will treat you better than someone who misses payments or can only pay the minimum on a credit card.

The credit score from noddle, experian and equifax are just made up numbers that only you see, that score if not seen by any lender or any one else - it's just something the credit agencies make up to make you think their services are worth paying for

eotw

I have a Halifax Clarity card which I have used for travelling in the past. I am travelling to Italy this year and need €500 cash to pay for my accommodation. I don't want to carry that sort of money with me and hoped to withdraw it from a ATM using the Clarity card.

My question is, if I then pay it off immediately online, will I avoid the interest for the rest of the month?

Thanks in advance

Rupert

Stokesy

I've always preloaded it with the the amount I've planned to withdraw using the online service. I've never knowingly paid any of interest.

SuperHan

Stokesy wrote: »

I've always preloaded it with the the amount I've planned to withdraw using the online service. I've never knowingly paid any of interest.

That is however explicitly against the T&Cs of the card, and Halifax are within their rights to close your account if you do this. You may end up getting stuck abroad with no Clarity card if this is the case.

Much safer to take the hit on the pennies of interest instead of potentially being left with an expensive card as your only form of credit