Credit card shouldn’t be used for mortgage payment - Credit cards - News - Moneyfacts

News

Credit card shouldn’t be used for mortgage payment

Credit card shouldn’t be used for mortgage payment

Category: Credit cards

Updated: 12/03/2009
First Published: 12/03/2009

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Credit cards customers have been urged not to consider using this form of finance in order to pay off mortgages.

According to the Independent's House Doctor, doing so can result in high charges - both in interest and for withdrawing cash using the card.

The paper explained that unlike purchases, taking money out can lead to interest of up to 29 per cent, while a 2.5 per cent withdrawal fee may also be added.

Richard Morea, of mortgage broker London & Country, added that credit cards should only be used as an absolute last resort and that consumers should instead contact their bank if there is a problem.

"Lenders really don't want to start down the road to repossession, as it can be very long, drawn out and costly and there are plenty of other options you can consider," he was quoted as saying.

Saga recently revealed that 32 per cent of credit card customers are using a reward credit card in order to maximise their spending.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Top credit cards for Christmas spending

‘Tis (just about) the season to be jolly, but before all that festive fun begins, chances are you’ve got a bit more shopping to do. But, if you’re turning to credit to fund things, you’ll want to use cards that offer 0% interest deals on purchases.

Spooky reality of high balance transfer fees

Credit card debt is scary at any time of year. While most might assume that opting for the longest deal on offer would save them the most, our data shows some of the longest deals can actually work out to be the most expensive.

Reward credit cards that become ‘pointless’

If you regularly use cards to pay at the till, you may have considered opening a reward credit card to earn points every time you spend. However, not all of these cards are as rewarding as they may seem…
 
Close