Maximizing credit card usage to reduce LOC account usage

[JohnHenry]

Hi People,

I'd like to know if what I'm doing here is right to reduce the expense of paying the LOC account interest.

I have several free annual fee credit cards eg. HSBC with Credit Limit $9000 and also Bankwest Zero transaction $5000, they're both almost maxed out with 99% used up so I just pay the minimum amount that they ask for me to pay it monthly.

and now I'm thinking to open up some more credit card with no annual fee just to avoid withdrawing from my LOC account.

Is that what people with investment property should do ?

 

[wylie]

The interest you are paying on the credit cards would be considerably higher than the interest on your housing or investment loans.

 

[Tin Tin]

when i had a business failure i found a bank (hsbc i think it was at the time) that had a free interest period of 9 mths. I essentially did the same thing which was helpful at the time.

What you might want to do is order a copy of your veda file to see what it says about your credit application history. You can get yourself into trouble if you have too many hits on your veda file when you go for a loan (hits being - too many loan applications in a period of time).

I had banks question my loan applications even though I went for a 450k loan with a bank and then withdrew my application - it was still on the file.. So 3 mths later when I tried with another lender, it came up on my file that i had already tried for a 450k loan and had several loans of UNDISCLOSED AMOUNTS which were the credit cards.

 

[Garry Mac]

There is little doubt the interest on your credit card is much higher than your LOC. Credit cards can be a 'god-send' if used correctly. Provided you are disciplined, by all means use your credit card(s) as much as possible BUT (and that's a BIG BUT), pay off the total balance by the due date...this way you can leave your money in your LOC for the (credit card) interest free period and save - every little bit helps AND believe me, the savings can be substantial!

Think about transferring your balances to another bank with zero to low interest on balances transferred.

Check out the comparisons:
http://www.creditcard.com.au/0-balance-transfer-credit-cards?gclid=CK-3nZv8tqsCFahS4godKxtVcw

Just make sure you pay off the balance (once you've transferred) and keep it that way.

Cheers
Garry

 

[Melbournian]

only in for credit cards coz of the points.