Use a credit card to pay in monthly instalments

john_st

Hi all

I'm moving to the UK next month for work. I landed a permanent position in London and it's wonderful I do have some questions though.

You see, I'm Croatian and here it's the norm for people with credit cards such as American Express or Diners to use them for big buys (a couch, a washing machine, a fridge etc) where the cost is spread in (usually 12) monthly instalments with no interest.

Since I've seen many wonderful rewards credit card companies offer for new clients if they spend a certain amount in a certain time period, and since I need a new laptop + my yearly Travelcard, I thought it might be amazing to pay for them in the same way I'd do it in Croatia.

However, I can't seem to find if this system even exists (let alone works) in the UK. Could you please give me a hand with this?

Thank you :beer:

bsms1147

It's the same here, you'd want a card that charges 0% interest on purchases.
eg. http://www.moneysavingexpert.com/credit-cards/best-0-credit-cards
Up to 27 months 0% purchases.

But having just moved to the UK you would probably find it difficult to get any form of credit card though, let alone a 0% one.

grumbler

john_st wrote: »

You see, I'm Croatian and here it's the norm for people with credit cards such as American Express or Diners to use them for big buys (a couch, a washing machine, a fridge etc) where the cost is spread in (usually 12) monthly instalments with no interest.

bsms1147 wrote: »

It's the same here, you'd want a card that charges 0% interest on purchases.

I wouldn't say that an introductory offer is a "norm". Also, in UK you can make minimum payments, then pay a lump sum at the end. This isn't the same as "monthly instalments".

john_st

Hypothetically speaking, were I to get one of these 0% cards (chances are I wouldn't) are instalments a "bonus" that I would have to negotiate with the card company or is it something that's up to me i.e. I can choose whether to pay all in one go or in X instalments?

How do I actually buy something? Is it just a matter of me buying a laptop and telling the cashier to split it up in X instalments or is done some other way?

Regarding the minimum payments, I imagine that they cover the interest?

Caz3121

john_st wrote: »

Hypothetically speaking, were I to get one of these 0% cards (chances are I wouldn't) are instalments a "bonus" that I would have to negotiate with the card company or is it something that's up to me i.e. I can choose whether to pay all in one go or in X instalments?

How do I actually buy something? Is it just a matter of me buying a laptop and telling the cashier to split it up in X instalments or is done some other way?

Regarding the minimum payments, I imagine that they cover the interest?

Say you get a card with 12 months interest free on purchases and put a £600 purchase on it...the cashier will charge 1 payment of £600
you will then receive a monthly statement showing the purchase and the minimum payment required
you are required to make the minimum payments each month and can choose to pay more if you wish
If you pay £50 per month then by the end of the 12 months you will have paid it all off and no interest due
If you pay £20 per month, you will still have £360 to pay in the final month or interest will start kicking in
If you pay £100 per month then it will all be paid off after 6 months

I think this is very hypothetical as it is unlikely someone new to the UK would qualify for these types of offers

Marcio45

Some of the catalogue companies like Very.co.uk work more or less the way you expect. On purchases of a certain value you can Buy Now Pay Later up to 12 months. You can then choose to pay by instalments or pay only at the end of the 12 month period, without interest. If you take more than 12 months to pay it off, then you will have to pay interest from day one, which is very very expensive.
but as others have already said, in the Uk most credit companies use a credit scoring system, and you need to build a good credit history before getting such good deals. Many years ago, even opening a bank account was a serious trouble. Now it is a little easier for foreigners just arriving in the country, but i would think credit cards would be out of reach for at least a year.
but welcome and good luck

bengal-stripe

john_st wrote: »

I'm moving to the UK next month for work....You see, I'm Croatian

If you have never lived or worked previously in this country and have acquired a credit history, you probably will have difficulties getting a credit card immediately. For the credit card issuing bank you are an unknown quantity. You have no history of credit, so the bank has no indication whether you will turn out to be a good or a bad egg.

Usually you are expected to have lived for at least three years in the country before you are considered for credit.

bearcat16

I think the OP is referring to a situation where the retailer is the one who collects payments monthly. Not very common here.

The only one I know of is Brighthouse, the goods are paid for monthly (as long as you pass their credit check) and there is interest to pay.

but boy oh boy the prices are inflated. Often you'll pay twice as much for the same item as other retailers. This is considered sub-prime lending here in the UK, and as such is very expensive.

Better to save up, or could you apply for a 0% credit card from a Croatian bank?

HappyMJ

bearcat16 wrote: »

I think the OP is referring to a situation where the retailer is the one who collects payments monthly. Not very common here.

The only one I know of is Brighthouse, the goods are paid for monthly (as long as you pass their credit check) and there is no interest added.

No interest, but boy oh boy the prices are inflated. Often you'll pay twice as much for the same item as other retailers. This is considered sub-prime lending here in the UK, and as such is very expensive.

Better to save up.

Bright House charges 99.9% APR as well as over inflating the purchase price of the product.

For example a Xbox One with a FIFA 16 and Games of War is £268 on Amazon. http://www.amazon.co.uk/Xbox-500GB-Console-FIFA-Gears/dp/B0185NUBHU

Bright House sells that same package for £14.17 a week for a total cost of £1,842.10....for an Xbox One. Ouch... http://www.brighthouse.co.uk/gaming/xbox-one-fifa-16-gears-of-war-ultimate-bundle/

587% MORE!!! Ouch....

bearcat16

HappyMJ wrote: »

Bright House charges 99.9% APR as well as over inflating the purchase price of the product.

yes sorry I was wrong about that. Crazy interest rate. Edited my post now.

HappyMJ

bearcat16 wrote: »

yes sorry I was wrong about that. Crazy interest rate. Edited my post now.

Agreed it makes me sick. I had to mystery shop the store once and the sales person quite quickly determined I had the financial knowledge to know that everything was sold at a terribly over inflated price and the mystery shop didn't really work out as planned as he knew I could just go elsewhere and put the item on my CC even if I was paying 35.9% interest it would have been cheaper so he kept referring me to other stores and declined to show me anything. It was probably my attitude. They still paid me for the report I completed.