Paying large amounts by credit card for added protection

benawhile

I see a lot written about paying a builder (in my case, but also for any trader)  by credit card, to get the benefit of consumer protection, but how can you do that if your card limit is no more than the standard limit of £3000? Suppose you are building an extension?

Say some double glazing costs £7,000, can you put £7,000 into your card account from your savings account and pay your builder via your credit card that way? And if that works, are you still covered for the £7000 by the card company?

Aylesbury_Duck

You don't have to put the whole amount on a card to get the section 75 protection. 

benawhile

Fair enough but can you still do it that way, i.e. by transferring enough in to cover first and paying it straight out again?

Aylesbury_Duck

I'd have thought so, yes.  You may find that some traders won't accept large sums by credit card, though.  They pay a fee to do so.

davidmcn

benawhile said:

Fair enough but can you still do it that way, i.e. by transferring enough in to cover first and paying it straight out again?

Depends on your credit card company's terms, some "bounce" any payments which put the account into credit.
Have you tried asking for the credit limit to be increased?

williamgriffin

benawhile said:

I see a lot written about paying a builder (in my case, but also for any trader)  by credit card, to get the benefit of consumer protection, but how can you do that if your card limit is no more than the standard limit of £3000? Suppose you are building an extension?

Say some double glazing costs £7,000, can you put £7,000 into your card account from your savings account and pay your builder via your credit card that way? And if that works, are you still covered for the £7000 by the card company?

Your builder probably won't take credit card payments and doesn't have to. You may be able to pay for the glazing direct to that company, the builder may ask you to do so any way, they may or may not take a card. If you were to pay for everything via the builder and put £1 of it on a card and the total is over £30,000 you'll have no protection.

Best thing to do is research on the builder before you start. 

born_again

As above. 
Just what is the total of the work you are looking at?

In effect you can pay 1 Penny on a credit card and have S75 cover (subject to criteria being met) But finding a builder to take a credit card could be a issue. Balance can be by any other means, so long as you have receipts.
Paying for something like just windows. If you are looking at claiming for any of the other work, could well be met with a no chance. 

benawhile

About £60K total broken down into stages of amounts up to £5,000, but there will be more than one payments to be made each month. Nothing up front though.

Sandtree

benawhile said:

Fair enough but can you still do it that way, i.e. by transferring enough in to cover first and paying it straight out again?

What do you mean transferring?

You only have to pay £0.01 on your credit card as long as what you are buying is between £100 and £30,000. If the total value is above or below this then there is no cover.

You also have to pay the merchant directly with your credit card, you cannot transfer money to your bank account and then pay the builder and certain middle men (eg PayPal) can also break the supply chain invalidating the protection. Many builders however don't have any capability to accept credit cards.

benawhile

OK, I meant transferring if you wanted to pay the whole sum via card and it was over the usual £3000 limit.

The total amount I am paying the builder will be about £60,000 but I will be doing it in stages of about £5,000. Is that too much rule bending?

Sandtree

benawhile said:

OK, I meant transferring if you wanted to pay the whole sum via card and it was over the usual £3000 limit.

The total amount I am paying the builder will be about £60,000 but I will be doing it in stages of about £5,000. Is that too much rule bending?

Its not rule bending it just means its not covered... the law is moderately clear that its the total cost that has to be compared to the limits and not the individual payments.