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consumers_revenge · 12 January 2018 at 3:16PM

Hi,

Forgive me for being a poss numpty with this.

Never had a 0% deal before.

Do I take it that if you were to purchased something for say 5k you just have to pay back either the minimum each month ( and face a big final payment ) or make a regular payment divided by the number of month and that's it?

Sorry if sounds stupid

Cheers.

[Deleted User] · 12 January 2018 at 3:22PM

If it's a 0% purchases card, yes.

If you miss a payment or go overlimit, you'll lose the promo.

Ebe_Scrooge · 12 January 2018 at 3:22PM

Correct.

The only thing to watch for, is to make absolutely sure you make the minimum payment each month - if you miss one, or are late, they'll usually instantly revoke the 0% promotion.

Also, if you want to be really MSE, pay the minimum to the card each month, and put money aside into an interest-generating bank account ( if such a beast still exists these days ! ), then you'll have the cash ready plus a little bit of a bonus when the deal runs off and you want to repay the whole lot ( assuming you don't want to or can't shift it to another 0% card - which you should never reply on being able to do anyway ).

molerat · 12 January 2018 at 3:23PM

Yes, as simple as that. The biggest point of note is the date when interest will be charged, not always in line with statement or normal payment dates.

Kim_13 · 12 January 2018 at 4:01PM

As other posters have said, you repay the minimum payment each month (this can differ card to card so do check what this is before deciding on a card to apply for) then repay the rest just before the 0% ends.

It gives you time to earn interest on the money you would have spent on the purchase, or to get the full amount together if you don't have it at the time of purchase. Ideally you'd want to be in a position to clear the card at the end of the deal, but if that's not possible, there are different cards for 0% balance transfers (typically coming with a transfer fee.)

This MSE guide on the best 0% purchase cards may help: https://www.moneysavingexpert.com/credit-cards/best-0-credit-cards

Having made a large purchase with a credit card (or part paid using one) you also benefit from Section 75 protection on the purchase.

[Deleted User] · 12 January 2018 at 5:40PM

Best to set up a direct debit for the minimum payment each month then you don't forget and lose the promo rate, you can also then make additional payments when you chose.

chattychappy · 12 January 2018 at 11:40PM

venison wrote: »

Best to set up a direct debit for the minimum payment each month then you don't forget and lose the promo rate, you can also then make additional payments when you chose.

If you use DD, then:

1) Make sure it is set up in time. So often people miss the first payment because although they set it up before the first payment was due, it still wasn't set up earlier enough. Only rely on a DD working if you see on your statement that the payment will be taken by DD.

2) You must still check your statements each month. Plenty of threads here from people who don't bother only to find months later that something went wrong and all sorts of charges/interest have been applied. (Often because of (1) above.)

3) You mustn't "forget" when and how much will be taken from your current account. Without DD, if you "forget", you can get a missed payment fee, interest, and a report to a CRA. With a DD, if you "forget" to have the money ready, you can get all this PLUS charges on your current account.

4) It is worth paying at least £1 more than the minimum payment in order to avoid the "minimum payment" marker on your CRA report, though whether this is particularly negative probably depends on other factors. If you make manual payments, be sure to understand how they affect the amount taken by DD.

Personally I don't use DDs, but many here get on well with them. Just be aware of the pitfalls.

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