Credit Cards for protection

purpleparrotuk

I have a remortgage setup to start the beginning of the year. I understand you are not supposed to use credit cards before it’s all finalised. 

The problem with that is I am purchasing 3 expensive items in the next week and I normally use the credit card for purchase protection. I don’t fancy using my normal bank account in case something goes wrong after purchase. 

Will the banks frown if you use the credit card then pay it straight off each time just for the protection part if it? Can they refuse to give us the remortgage?

housebuyer143

purpleparrotuk said:

I have a remortgage setup to start the beginning of the year. I understand you are not supposed to use credit cards before it’s all finalised. 

The problem with that is I am purchasing 3 expensive items in the next week and I normally use the credit card for purchase protection. I don’t fancy using my normal bank account in case something goes wrong after purchase. 

Will the banks frown if you use the credit card then pay it straight off each time just for the protection part if it? Can they refuse to give us the remortgage?

At long as the balance is what you stated on your application it shouldn't matter. 
If you pay it off right away then it shouldn't make any difference as you are not increasing your borrowing. 

purpleparrotuk

housebuyer143 said:

purpleparrotuk said:

I have a remortgage setup to start the beginning of the year. I understand you are not supposed to use credit cards before it’s all finalised. 

The problem with that is I am purchasing 3 expensive items in the next week and I normally use the credit card for purchase protection. I don’t fancy using my normal bank account in case something goes wrong after purchase. 

Will the banks frown if you use the credit card then pay it straight off each time just for the protection part if it? Can they refuse to give us the remortgage?

At long as the balance is what you stated on your application it shouldn't matter. 
If you pay it off right away then it shouldn't make any difference as you are not increasing your borrowing. 

Thanks. My concern is the balance can take a while to change on credit reports so it might show as not paid off if by chance they look at it the wrong time 

Danieljw90

When I was applying for my mortgage I was advised to not take out any form of lending between application and completion 

reason I was given this advice is because most banks can run extra credit checks before completion and yes your right the figure can linger on your file for a month or two. 

SusieT

Normally if you use your card and pay it so that the payment is recorded before the statement date, the balance will not show any new lending. However, you will MUST still pay at least the minimum payment (assuming you have other things on it) after the statement date. 
I woud check the date that the statement is normally produced, and then decide how to time the purchase and payment so that the balance is unchanged.

K_S

purpleparrotuk said:

I have a remortgage setup to start the beginning of the year. I understand you are not supposed to use credit cards before it’s all finalised. 

The problem with that is I am purchasing 3 expensive items in the next week and I normally use the credit card for purchase protection. I don’t fancy using my normal bank account in case something goes wrong after purchase. 

Will the banks frown if you use the credit card then pay it straight off each time just for the protection part if it? Can they refuse to give us the remortgage?

@purpleparrotuk Can't predict the exact outcome for your specific case, but generally speaking what I would advise a client if they asked me this question is to make the purchase on the credit card and pay it off in full the very same day.

If you wait for the usually monthly payment date for it to be fully paid off, the risk is that your report might show a high balance for a period and if it is large enough to impact your affordability (as per lender calculations) or lender credit scoring (nothing to do with the experian Equifax TransUnion credit score) then it could potentially cause issues prior to completion.

ACG

If you buy something on your credit card and pay it off the same day, I would be VERY surprised if it was picked up on your credit report. When I used to work for the credit card department of a large bank, we would only update the balance to the credit agency once a month (but we are talking around 15 years ago now). 

mrsplinter

purpleparrotuk said:

I have a remortgage setup to start the beginning of the year. I understand you are not supposed to use credit cards before it’s all finalised. 

The problem with that is I am purchasing 3 expensive items in the next week and I normally use the credit card for purchase protection. I don’t fancy using my normal bank account in case something goes wrong after purchase. 

Will the banks frown if you use the credit card then pay it straight off each time just for the protection part if it? Can they refuse to give us the remortgage?

You don't need to pay for the item in full on a credit card to gain s.75 protection. You can just pay any amount towards the purchase on a credit (eg £1) and you are still covered for the full cost of the purchase.