0% spending credit card

Leesulivan1983

Hello,

I'm new to credit cards. Never had one before however I may need one now.

I want to buy a car for say £4,000 and have £2,000 saved up so need to borrow the remaining £2,000.

My question is if I get a 0% spending credit card and use it to pay the remaining £2,000 over 24 months, do I literally just pay £83.33 over 24 months or will there be interest on top? How do I know that the minimum won't be more?

Sorry if this is a stupid question, as I say new to borrowing.

YorkshireBoy

Leesulivan1983 wrote: »

I want to buy a car for say £4,000 and have £2,000 saved up so need to borrow the remaining £2,000.

If that's all the cash you have do you think it's wise to leave yourself without a cash buffer? Where's the cash to pay for the insurance, tax, repairs, MOTs, etc, etc...plus all your other life costs?

My question is if I get a 0% spending credit card and use it to pay the remaining £2,000 over 24 months, do I literally just pay £83.33 over 24 months or will there be interest on top?

0% interest means 0% interest!

How do I know that the minimum won't be more?

You'd read the card's summary box or T&Cs. However, most cards require a 1% plus interest per month payment...in effect, during the intro period, 1%.

new to borrowing.

Maybe you'd benefit from reading this article?...

http://www.moneysavingexpert.com/credit-cards/best-0-credit-cards

Leesulivan1983

Thanks for your reply

£2000 is what I've saved to put towards the car. I have more kept aside for other things. The £2000 of repayments is safely within my monthly income on top of living costs.

I get the 0% interest its just the minimum repayment of 1% plus interest that I don't get. Thought there wasn't any interest? Does it mean I pay interest if I only pay the minimum?

YorkshireBoy

As I said above, it's generally 1% plus interest. Since the interest RATE during the intro period is 0%, it's 1%. Clear?

NB: It may be slightly more, as some cards have a minimum of £25, so it's £25 up to £2,500...and 1% above this.

Mulder00

How long is your 0% offer for - if not for the entire 24 months then you will start paying interest at some point.

Superscrooge

Leesulivan1983 wrote: »

Hello,

I'm new to credit cards. Never had one before however I may need one now.

I want to buy a car for say £4,000 and have £2,000 saved up so need to borrow the remaining £2,000.

My question is if I get a 0% spending credit card and use it to pay the remaining £2,000 over 24 months, do I literally just pay £83.33 over 24 months or will there be interest on top? How do I know that the minimum won't be more?

Sorry if this is a stupid question, as I say new to borrowing.

A couple of possible problems with your plan that you need to be aware of .................

1. Some car dealers receive incentives to push their own finance plans, so don't accept credit cards. It would be worth checking credit cards are accepted, if you know where you want to buy the car from?

2. You have never had a credit card before. If you have no credit history you may struggle to get a 0% card and be limited to credit builder cards which charge a high rate of interest

It would be worth using the credit card eligibility checker
https://www.moneysavingexpert.com/eligibility/credit-cards/

Leesulivan1983

The credit card is 0% for 27 months. I have done the eligibility checker and am 75% chance of being accepted.

If I'm allowed more than £2,000 credit and I pay £83.33 per month for 24 months I won't have to pay interest. Unless there is an outstanding balance after the 27 months. If that's correct then that'll do me.

The car dealer does accept credit cards.

YorkshireBoy

Leesulivan1983 wrote: »

The car dealer does accept credit cards.

And what does he charge for doing so?...2%?...3%? Don't forget to factor that in.

Leesulivan1983

Understood.

Many thanks for your help.