Could A Credit Card Help You To Save More?
Monday December 1, 2008
Using a credit card with interest free days on purchases and a redraw facility or offset account could help you pay your mortgage company faster. If you are willing to put as much into your mortgage as possible and are capable of controlling your spending, then one of the most useful personal mortgage tips is to spend with your credit card in order to minimise interest charges on your mortgage, repaying fast enough to avoid interest on the credit card.
As interest is often calculated daily on your mortgage, the longer you keep any amount of money in your mortgage for, the less interest that will be calculated and charged. This means that the longer you can keep the maximum amount of money in your mortgage, the less you will need to pay in the long run. By paying for your essential purchases on your credit card and then repaying the entirety of your credit card each month as late as possible in order to take advantage of interest free days on purchases, you can potentially reduce the amount of interest you will be charged.
There are many factors to consider when trying this money saving technique, however. Is there a fee for redrawing on your mortgage? How much does your credit card cost each year and will that negate any interest savings? Can you keep your spending in control when using a credit card, or are you prone to spending more? Before trying any particular strategy for saving on mortgages, work out potential savings with mortgage calculators, weigh up the costs to see if there is an overall advantage, and consult with a financial advisor if the strategy could see a risk to your investment.
Please visit our comparison page to compare home loans and mortgages and feel free to browse our site to read about different mortgage types or to read about a specific mortgage company.
Share This