Virgin Money Stooze

Rougvie_2

Hi .
Just wanted to check something with the more experienced stoozers out there. Heres the facts.

Just started my stooze on a Virgin Money card with 15 months 0% with a CL of £9k. I have therefore BTed £8300. I chose this amount in order that the amount BTed and the fee is slightly less than the 95% of the CL (£8550). I have used the funds to work on my offset mortgage which has an interest rate of 6.6%

Virgin have sent my credit card cheques with my credit card.

Presumably after I have made the first monthly minimum payment , which will be about £250, I can write a cheque to myself equal to a value of 97% of the minimum monthly payment (to allow for the 3% cheque fee) and pay into my offset account. Presumably I can then reapeat this after every monthly minimum payment has been made. The balance on the Virgin money card would never exceed 95% of the CL. I imagine that there will come a time - probably 3-4 months prior the end of the 15 month 0% period where the cheque fee will exceed the beefit to be gained.

I'd be grateful if someone could review the logic of the above and point out if I have missed something in this strategy.

YorkshireBoy

Rougvie wrote: »

I'd be grateful if someone could review the logic of the above and point out if I have missed something in this strategy.

The second, and subsequent, minimum payments are only £25.

Rougvie_2

Ok I didn't realise that. Thanks Yorkshire boy

wayoflife

YorkshireBoy wrote: »

The second, and subsequent, minimum payments are only £25.

Or even better, the payments are only £5.00 each month with MBNA (im 99% sure!) so assuming you absorb the £5.00 each month

so on the amount you want to stooze, (accounting for 1 months 'leigh way' [generous] for the balace transfer to go into your account and making the payment by the due date) you will save £395.38 over this period.

Another moneysaving tip: wait until your last statement comes through ring them and negotiate a new deal. They will want to keep your business (FYI you should get a lower handling fee).

Ive just got a card and done the same thing as you mate

any comments welcome...

cheers

Idiophreak

Yeah, I was gonna add that my virgin cc balance only cost me £5/month - not worth worrying about.

wayoflife

sorry Ive had bad advice from NBNA!

Your right Yourskire boy...sorry no offense meant! (its old customers that only have to pay £5.00!)

Based on this new calculations you will stand to save roughly £394.49 over this period

cheers!

wayoflife

just thought also another big point, make sure your calculated profits include a tax deduction in your savings if applicable!! grrrr forgot about this, it halved my profits! lol

Martinslovechild

wayoflife wrote: »

just thought also another big point, make sure your calculated profits include a tax deduction in your savings if applicable!! grrrr forgot about this, it halved my profits! lol

The original poster mentioned that he's using the cash to deposit into his offset mortgage account, therefore there is no tax to pay on the £8300 as he's using the money to reduce the amount of interest paid on his mortgage.

In fact, because he's currently paying a mortgage interest rate of 6.6%, this is equivalent to his stoozed funds receiving a gross interest rate of 8.25% (basic-rate taxpayer) or 11% (higher-rate taxpayer).

If anybody else is considering doing a similar thing, then ensure you have a fully flexible mortgage, i.e. one that allows both overpayments (deposits) and a drawdown facility (withdrawals). There are a number of mortgages out there which allow overpayments but once the money's been paid in, you aren't able to withdraw it at a later date (not good if you're stoozing large amounts against the mortgage).

Additionally, should your mortgage company ask you if you want to make deposits against capital or into your overpayment fund, always respond by saying that you want funds deposited into your overpayment fund - this means that you can then ask for these amounts back at any time. If deposits are made against capital, this means that the funds are used to reduce the amount of mortgage outstanding, your overpayment fund therefore doesn't increase and you aren't able to withdraw the funds at a later date.

Han_naH

Hi - anyone know the maximum amount you can borrow from the Virgin card or is it user specific?

Mutton_Geoff

anyone know the maximum amount you can borrow from the Virgin card or is it user specific?

Their website states £50k but of course it will be dependant on the customers financial rating with them.

Steve1981

Rougvie wrote: »

Hi .
Just wanted to check something with the more experienced stoozers out there. Heres the facts.

Just started my stooze on a Virgin Money card with 15 months 0% with a CL of £9k. I have therefore BTed £8300. I chose this amount in order that the amount BTed and the fee is slightly less than the 95% of the CL (£8550). I have used the funds to work on my offset mortgage which has an interest rate of 6.6%

Virgin have sent my credit card cheques with my credit card.

Presumably after I have made the first monthly minimum payment , which will be about £250, I can write a cheque to myself equal to a value of 97% of the minimum monthly payment (to allow for the 3% cheque fee) and pay into my offset account. Presumably I can then reapeat this after every monthly minimum payment has been made. The balance on the Virgin money card would never exceed 95% of the CL.

Once again I am probably missing something but could you not transfer this straight from a current account against the mortgage without having to do the cheque side of things?

Also do I have this right in that you pay the min monthly payment (£25) and then at the end of the 0% transfer it back to pay the card off and the time you have been using it against the mortgage has reduced the interest that you pay?

Exactly how does this work/is there a starters guide in terms of step-by-step? as obviously my mortgage is my biggest debt and my real aim is to get it cleared asap?