Interest free credit or credit card?

darreng

I am about to have some new windows and doors fitted. The company has “Buy now, pay in 12 months offer”. The monthly repayments are approx £400pm, or full payment in 12 months before a large interest rate is applied. Would it be better to apply for a 0% for 2 yrs card, pay for the widows in full and then after 2 yrs, if there is still a balance on the card, apply for a 0% balance transfer card?

Hope that makes sense

oldernonethewiser

Ask what discount you might get by paying in full?

darreng

There’s no discount for paying in full. It’s pay whole amount now, pay any amounts for 12 months up to cost or pay in full in 12 mths

jaybeetoo

Is the total amount less than £30k? If so you’ll get section 75 protection on a credit card even if you pay just the deposit with the card.

retiredbanker1

It will all depend on 1. Do the company accept credit cards? and 2. Will you get a card with a high enough limit and timescale to suit.

MyRealNameToo

https://forums.moneysavingexpert.com/discussion/6673683/interest-free-credit-or-credit-card

What happens if you cant get another credit card in 2 years time?

Can you afford this renovation if the combination of your savings now and 2 years of credit means you still doesnt allow you to pay it off?

darreng

Thanks for all the comments and points made. The value is less than £30k, the payment is made o Novuna finance due to it being buy now pay later so a credit card should be a viable option. I should be able to get another card in 2 yrs, my credit score is v good and I can’t see anything major changing that. As an add on, Mrs G has squirrelling money away each month so we should have a fair portion saved. Maybe I’ll get a card and book a holiday instead 😂

CliveOfIndia

https://forums.moneysavingexpert.com/discussion/comment/82046231#Comment_82046231

It's still not a good idea to bank on being able to get another card. Aside from the fact that your credit score is meaningless (it's neither seen nor used by any lender), who knows what the financial landscape will look like in 2 years? It's possible that lenders in general could tighten their acceptance criteria across the board.

That aside, do you have the money available to pay for the windows outright? I'm just thinking, it may be possible to pay using a credit card that gives you cashback or points or whatever. In all probability you wouldn't get a card that offers rewards and 0%, so you'd have to pay it off in full when the statement arrives (or BT to another card, taking account of any fees that may apply - no point doing that if the fees wipe out whatever rewards you've earned). But it may be something you want to think about. Pay in full, grab the rewards from the card, then rebuild your savings by paying the £400 a month or whatever it would have cost you for the BNPL, into your savings account.

Gandalf644

https://forums.moneysavingexpert.com/discussion/comment/82046231#Comment_82046231

If you are going to try to use a credit card to pay off what is essentially a finance agreement from a finance company, at least make sure whichever card you opt for will not treat it as a 'cash' or 'cash like' transaction. If they do, not only will full interest become payable immediately but any 0% deals/offers do not usually apply.

It maybe that you may need to look at a 0% 'Money Transfer' card paid into your bank account to pay off the finance company and then go froward from there via a balance transfer card.

https://www.moneysavingexpert.com/credit-cards/money-transfers/

SacredStephan

I would encourage you to pay at least £100.01 some of this on a credit card, if you can, for s75 protection. The finance company won't go out of their way to remind you when the 12 month interest "free" period is expiring, in my experience.

Nasqueron

https://forums.moneysavingexpert.com/discussion/comment/82046745#Comment_82046745

1p*

£100 is the minimum amount of the order to qualify for S75, you do not need to spend £100 on the card