Using 0% credit card for mortgage over payment

nosworthy

Hi,

My window for overpayment on my mortgage is up on 31/8 and would like to keep up my plan to pay it off as quick as possible.

I had some resolved health issue at the start of the year so this looks to be the best option. Repayment isn't an issue so would I be able to take a credit card out (as long as eligible), pay off the 9k max of overpayment and pay it off at my leisure? I've rarely had credit and have saved up for most things so am inexperienced at this. I could pay the 9k off if it was 0% in about 9 months or less if I was allowed to overpay the credit card when possible.

I looked into bank transfer and using my credit account to make the overpayment but would be charged about 3% so could I just use the credit card for this?

Any advice much appreciated.

surreysaver

How would you get the money from the credit card to the mortgage? Is it a money transfer offer you've got?

CliveOfIndia

You won't be able to do this. It's highly unlikely the mortgage provider would accept payment by credit card. Even if they did, it would be treated as a cash advance by your card provider, meaning you'd be charged a cash advance fee, and it wouldn't qualify for any 0% promotional rate.

A money transfer card would be the only way to do it. But as you've discovered, the card will impose a fee, so you'd have to work out whether it was beneficial overall.

Isthisforreal99

So are you talking about a money transfer card transferring money to your current account then overpaying your mortgage? If so, that will work assuming you get the required credit limit. Also note that the amount you can transfer will not be 100% of your credit limit and the minimum monthly repayment on the card will be between 1% - 2.5%, depending on the card.

nosworthy

https://forums.moneysavingexpert.com/discussion/comment/82102016#Comment_82102016

Would it not be 0% on the minimum repayments? What about the interest on above the minimum repayments? If there's a charge of 3% or so on the bank transfer and 1-2.5% on minimum payback then what is the 0% referring to if there's interest on the bank transfer and the minimum repayments?

Isthisforreal99

https://forums.moneysavingexpert.com/discussion/comment/82102027#Comment_82102027

No, 0% means no interest will be charged but there will always be a minimum payment on a credit card.

CliveOfIndia

https://forums.moneysavingexpert.com/discussion/comment/82102027#Comment_82102027

Please could you clarify your question?

My understanding is that you'd like to get a Money Transfer credit card, use that to deposit money into your bank, then use that money to make a payment towards your mortgage?

If so, you'll pay a one-off fee to the card company for doing the transfer. From then on, no interest is charged by the card company for the duration of the promotional rate, but you must make the minimum payment to the card each month.

Also, bear in mind that you'll have to repay the whole credit card debt when the promotional rate expires.

nosworthy

https://forums.moneysavingexpert.com/discussion/comment/82102029#Comment_82102029

Yes, I'll happily pay my credit card off ASAP and pay more than the minimum as long as it's a thing that these types of offers are available.

Ah, you meant 1-2.5% of the debt on the credit card not 1-2.5% interest on the minimum payment.

So I could get a 0% bank transfer (@3%) and pay back any amount at or above the minimum repayment when viable ( but always at least the minimum on time)?

Isthisforreal99

https://forums.moneysavingexpert.com/discussion/comment/82102036#Comment_82102036

Correct, look here for best money transfer cards - https://www.moneysavingexpert.com/credit-cards/money-transfers/

nosworthy

That's great. Thanks.

lr1277

I am not entirely clear as to whether the overpayment will clear the mortgage or whether it will reduce the amount you owe.

If the latter you will still have to continue paying your mortgage, perhaps at a reduced monthly payment because the amount you owe has decreased.