If you have a great credit rating and no debt, then
you could be in line to make some money. And you can do it using the
tools that credit card tarts have been using for years.
The Credit Card Tart System
Credit card tarts have used the
incentives offered by lenders to their advantage for quite a long time.
These incentives often consist of 0% interest on balance transfers for a
fixed period of up to 12 months. Borrowers who have a debt apply for a
new 0% credit card and transfer that debt to the new card. They make
repayments as they normally would, but the balance owed is reduced since
no interest is being charged.
When the incentive period is due to
end, credit card tarts look around for a new 0% deal. They apply for the
new card at least six weeks before the expiry of the old 0% deal, so
they have plenty of time to transfer the outstanding balance onto their
new 0% card.
This serial card switching allows
borrowers to clear debt without paying any interest. Lenders have begun
to fight back as they are losing hundreds of thousands of pounds' worth
of interest. Many of them now charge a balance transfer fee of about 2%.
However, there are still some fee free balance transfers available,
which is good news fro debt-free consumers looking to use the system to
make some money.
How To Earn Money On A 0% Card
To make money from a 0% balance
transfer card, it is necessary to have a good credit rating and to get
two new credit cards. One credit card has a 0% balance transfer rate.
This must be a card that does not charge a balance transfer fee. The
second allows credit card cheques at no additional charge.
The borrower can use the balance
transfer card to transfer a sum of money onto the card that allows
credit card cheques. The borrower can then write a cheque for that
amount and pay it into a high interest savings account. This strategy
only works if the interest earned is more than the amount being paid.
Borrowers can use the same technique to get a low interest loan. Long
term balance transfer rates are lower than standard interest rates on
loans.
But Is It Legal?
There is nothing to prevent borrowers
from using their cards in this way. As long as they make repayments on
time and in full, there are unlikely to be complaints. It is also
essential to keep credit card applications to a minimum so there are no
red flags on the borrower's credit report. There's no reason why
borrowers who stick to these rules and make payments on time shouldn't
make a bit of money from their credit cards. And while they're shopping
around for the perfect credit cards, it's worth checking out the other
incentives as well.
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