Stoozing

[sue52]

I've never heard of this before but someone mentioned stoozing on another thread. Has anyone done this or am I stupid to even consider it? The money would come in handy to restore an ancient but dilapidated listed agricultural building. Any feed back gratefully received.

Sounds great if you know what you're doing. I should imagine it's fairly time-consuming to get it right, though, no? I think it was Martin Whatnot who I saw recommend doing it on TV about a year ago. It sounded far too complicated for my pea brain but seems to work well for people more switched on than me.

I've done it in the past. I started over 10 years ago and at one point had about £40k spread over 4 cards, no bad for someone with no personal income!

It's much harder now as cards normally charge a handling fee for cash advances or balance transfers and also interest rates are down, so it's much harder to find somewhere that will make enough interest to make it worthwhile.

I think it's important to keep the money on deposit ready to pay the cards back though rather than spend it on house renovations...

Stoozing is getting money from credit cards at a 0% (or near as possible) and putting it in a bank account earning more than that. It's not just spending it on a project - that's just getting into debt.

Some people use it to juggle paying debts (i.e. they pay the minimum off their debts and save the extra that they could afford to pay off until the interest rate differential works against you)

it is not to be undertaken lightly and is quite hard work. I did it to help pay off debts but you have to be very disciplined.

Also it's very hard to get good credit limits and good interest rates at the moment so much harder to do.

MSE does have a lot of information on it but please be careful as you can find youeself with the CC debt and nothing in the savings account to pay it off...

Let's be very very clear about what stoozing is.

It is NOT spending money on credit cards.

Here's how it works. You borrow money on a 0% card, then you do not spend that money but instead put it in an account that pays interest.

You can then spend the interest earned on that money. Bear in mind you will be taxed on the interest.

You will need to pay back everything you have borrowed on the 0% credit card as soon as the 0% rate period ends. Often this is only 6 months. So you can't earn much interest in the meantime.

A alternative is to put the borrowed money in an account that is offset against your mortgage. This means that it notionally reduces the capital sum of your mortgage, and so means you pay less interest on the mortgage.

However, again, you will need to pay back the money when the 0% comes to an end, so then the capital sum of your mortgage will go back up.

Basically, it can work if you are (a) very disciplined and will not spend any of the borrowed money, only the interest it earns and (b) very organised so that you pay back the money borrowed as soon as the 0% is over.

have a look at www.moneysavingexpert.com for more details.