Balance transfer CC or build up credit score for re-mortgage?

Bert85

Hi everyone

I am tempted to get a pre-approved credit card 0% balance transfer 18 months, which will cover all my other cards debt and will save me £100/month of interest.

However.

My mortgage deal is coming to an end in 5 months and will increase of about £200/month.

My question is simple: should I get the card and save on interest, or build up the credit score for the re-mortgaging the deal?

In the worse case scenario, I will be moved to the BoE+1.5% rate if I do not remortgage.

Any advice, please?

CliveOfIndia

It's a bit of a conundrum.  The usual advice is not to take out any new lines of credit in the run-up to a mortgage application.  Are you likely to re-mortgage with the same company?  If so then it's not quite such an issue.  Yes, your access to available credit will be increased, which is certainly one factor that's taken into consideration.  But as long as your overall level of debt doesn't increase (hopefully it will actually decrease slightly as you'll be paying more off the capital and less in interest?) then it probably won't make that much of a difference. 

When you say you're pre-approved for a card, I'd take that with a pinch of salt.  An eligibility checker may say you're pre-approved, but it's not until your application is processed that you'll know for certain.

Bert85 said:

or build up the credit score for the re-mortgaging the deal?

Ignore your score (in fact, your score will probably drop if you take out a new credit card, but that doesn't matter).  All a lender is interested in is your credit history, how well you've managed your debts in the past, any defaults or late payments etc., your income and level of existing debt.  They don't even see the score dished out by the CRAs.

enthusiasticsaver

Pre approved means nothing but if you can save £100 a month on interest I would do it. How much credit card debt do you have?

Bert85

At the moment, in cards with interest, about £3.5k., including Aqua (39.9%apr)

The pre-approved comes from the Lloyd website, with which I have a current account

Bert85

@CliveOfIndia
The mortgage deals around are not very different in my case -LTV less than 50%, therefore I am thinking to stay with the same lender, where no extra fees are due or additional house valuation fees