"Stoozing" - advice for a noob

[ChemicalChaos]

Hi all,

I'm after some advice please and recommendation on the best cards" for "stoozing" (for I think that is the term).

I have a quite generous penalty free threshold to overpay my mortgage, and I won't be able to max it out this mortgage year from money I have in my account. However, I do have a couple of assets I can sell for roughly that amount once I've finished recommissioning them, the catch being that I won't have finished in time.
Hence, my plan was to put the next 2 month's or so outgoings onto a zero percent interest spending card, to free up the lump sum soon, then once into the next mortgage year I can sell at my leisure and put the money back into paying off the card whilst it's still at 0%.

Are there any pitfalls to this? (I can afford to pay off the card by my regular salary if needs be by sacrificing any mortgage overpayments the next year, in the worst case scenario of not being able to sell the stuff as soon as I'd hoped - so I do have a backstop for the obvious pitfall).
I'm also well aware that the way the banks make money on these cards is by hammering your interest if you dont meet the minimum monthly payment or exceed the interest free time.

Can anyone please recommend the card with the best limits on spend and interest-free repayment period? Something like 3k over 2 years would be the sort of ballpark. There's a bewildering variety on moneysaving expert so I'm after any personal experiences of good vs bad to help narrow it down.

Thanks in advance!

[Largechris]

Not sure I read or understood what you’re trying to do closely enough, but -

Interest rates are still really really low and likely to remain so in relation to inflation. You can do better on investment returns than paying down a mortgage at the moment.

Balance transfers etc. almost always have a fee, 1.5% etc.

If there are any fees involved you will lose more than you gain for the extra faff.

[ChemicalChaos]

I've seen some discussion in other threads about not overpaying mortgages, however... given that without overpayment, the annual interest for my first year's balance is nearly half of what I've paid, I can over a decade off my mortgage by overpaying this year and next. That's a lot of interest fees saved....

[jfdi]

Not heard Stoozing for a long time. You're 10 or more years late to the game. It used to be worth it when you could be earning 4 or 5% plus on someone else's money but all cards I've seen charge a transfer fee now and you'll be lucky to get 0.5% on any "safe" savings. Any small profit you might be able to make really isn't going to be worth the paperwork.

[Largechris]

ChemicalChaos said:

I've seen some discussion in other threads about not overpaying mortgages, however... given that without overpayment, the annual interest for my first year's balance is nearly half of what I've paid, I can over a decade off my mortgage by overpaying this year and next. That's a lot of interest fees saved....

You’ll find the recent thread on PH interesting on mortgages, if you look midway down at page 5 for example there’s some good explanations from Harry Flashman on leverage:

https://www.pistonheads.com/gassing/topic.asp?h=0&...

[blue_haddock]

15 years ago when actual interest could be had on savings accounts it was worthwhile but with how low rates are it just doesnt seem worth it anymore

[Mr Overheads]

moneysavingexpert website always has an upto date article on best 0% cards for balance transfers and money transfers. Go there.

[FredAstaire]

ChemicalChaos said:

I've seen some discussion in other threads about not overpaying mortgages, however... given that without overpayment, the annual interest for my first year's balance is nearly half of what I've paid, I can over a decade off my mortgage by overpaying this year and next. That's a lot of interest fees saved....

how much can you overpay by? is the maths on that right? do you really knock a decade off by overpaying for two years?

[ChemicalChaos]

blue_haddock said:

15 years ago when actual interest could be had on savings accounts it was worthwhile but with how low rates are it just doesnt seem worth it anymore

jfdi said:

Not heard Stoozing for a long time. You're 10 or more years late to the game. It used to be worth it when you could be earning 4 or 5% plus on someone else's money but all cards I've seen charge a transfer fee now and you'll be lucky to get 0.5% on any "safe" savings. Any small profit you might be able to make really isn't going to be worth the paperwork.

As I say, this is to use for up front capital rather than to try and scrape some savings account interest from it. I'm thinking of it more like a very large payday loan that if done correctly will be interest free

Largechris said:

You’ll find the recent thread on PH interesting on mortgages, if you look midway down at page 5 for example there’s some good explanations from Harry Flashman on leverage:

https://www.pistonheads.com/gassing/topic.asp?h=0&...

Yes, that's the thread I'd read. I'm still not sure I get the logic though, as to me I'd rather own my property sooner and pay far less in interest (ie wasted money) in the long term, plus whatever rise happens in house prices itll happen regardless of whether i'm ahead or behind on the mortgage? I'm obviously missing the something somewhere

FredAstaire said:

how much can you overpay by? is the maths on that right? do you really knock a decade off by overpaying for two years?

Just run it through the overpayment calculator again - not quite a decade, but close:

"Changes with overpayments
Making a one-off lump sum overpayment of £[maximum that I'm allowed without penalties, over each year of the 2 year fixed term]

could mean an interest saving of £16,803.12

and reduce your term by 8 years and 11 months"

[Largechris]

Largechris said:

You’ll find the recent thread on PH interesting on mortgages, if you look midway down at page 5 for example there’s some good explanations from Harry Flashman on leverage:

https://www.pistonheads.com/gassing/topic.asp?h=0&...

“Yes, that's the thread I'd read. I'm still not sure I get the logic though, as to me I'd rather own my property sooner and pay far less in interest (ie wasted money) in the long term, plus whatever rise happens in house prices itll happen regardless of whether i'm ahead or behind on the mortgage? I'm obviously missing the something somewhere “

1) His example was you are paying interest at 4% on a mortgage but if you’d put that “extra” money into the stock market instead it would have returned 9% last year.
2) If you put that extra money into your pension you get a big tax break that’s worth more than the 4% return as well.
3) At some point house prices will stop going up. Sounds crazy but it’s true.

[andyb]

Largechris said:

Largechris said:

You’ll find the recent thread on PH interesting on mortgages, if you look midway down at page 5 for example there’s some good explanations from Harry Flashman on leverage:

https://www.pistonheads.com/gassing/topic.asp?h=0&...

“Yes, that's the thread I'd read. I'm still not sure I get the logic though, as to me I'd rather own my property sooner and pay far less in interest (ie wasted money) in the long term, plus whatever rise happens in house prices itll happen regardless of whether i'm ahead or behind on the mortgage? I'm obviously missing the something somewhere “

1) His example was you are paying interest at 4% on a mortgage but if you’d put that “extra” money into the stock market instead it would have returned 9% last year.
2) If you put that extra money into your pension you get a big tax break that’s worth more than the 4% return as well.
3) At some point house prices will stop going up. Sounds crazy but it’s true.

Although also at some point the stock market wont grow 9% a year. Plus it matters how you invest - see the gamble thread Its hard to mess up overpaying the mortgage but relatively easy to mess up investing.

My advice is to split in half; over pay a bit but also invest some. And spend some time learning, its time well spent. Intelligent Money sticky thread is a good place to start.

[drmotorsport]

Stoozing, now there's a term i've not heard for a while I used to do that back in the day - right up until I had £8k in a certain Icelandic savings bank (and corresponding CC debt), which went bust. Only time I thanked Gordon Brown for bailing me out...

I still use interest free cards but just to smooth cashflow, theres plenty of comparison sites out there and banks and old CC companies keep sending me offers, but have used Barclaycard, Santander, Sainburys bank etc. Plenty still do interest free spending and balance transfer over useful periods of up to 24 months. Only irritation is that credit limit tends to be fairly low.

[Tim330]

Here's what I did. Obtain sainsburys bank credit card with 18 months zero interest on purchases. Link to a curve card. Use curve card to buy £10k in premium bonds. Win big prize. Pay back credit card by cashing in premium bonds in month 17 so no interest to pay.
You still need to make the minimum payment of course.
Only problem is I haven't even won £25 on the pb so maybe not such a great plan but doesn't cost me anything!

[Jakg]

Tim330 said:

Here's what I did. Obtain sainsburys bank credit card with 18 months zero interest on purchases. Link to a curve card. Use curve card to buy £10k in premium bonds. Win big prize. Pay back credit card by cashing in premium bonds in month 17 so no interest to pay.
You still need to make the minimum payment of course.
Only problem is I haven't even won £25 on the pb so maybe not such a great plan but doesn't cost me anything!

Can you withdraw from premium bonds to your bank account if you bought them via the curve card? If not I don't see how that helps the OP.

It's basically risk free gambling but no guaranteed returns.

However Curve have got hot on people "cash recycling" so I'm not convinced that a new user would be able to do that today.

[Tim330]

Yes, I believe so. At least you could a couple of years ago. I used to have a Lloyds mastercard that earned avios so linked this to curve and purchased premium bonds then took them out a month or so later and repeated. But as you say I think this is watched more closely now. Also Llyods closed their avios cards and you can't used curve with Amex so no free avios this way.