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Grab a great deal on a 0% spending credit card

Looking to make a big purchase? Long interest-free deals are available, but use your card with care

By Esther Shaw

Published: 07 September 2021

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If you’re looking to make a big purchase, such as a car, a holiday, or if you need to pay for furniture for a new home, you can now borrow cheaply interest-free for up to almost two years with a 0% spending card.

Here’s the lowdown.

What is a purchase credit card?

This type of plastic offers flexible borrowing. It is designed for shopping, and is a great way to spread the cost of a big purchase.

No interest is charged on new purchases and you can space out your repayments over a long period of time.

What deals are available?

Right now, you may be able to borrow at 0% interest for up 22 months with Tesco and up to 21 months with Sainsburys. You can compare deals here.

Use your card with care

If you do decide to apply for a purchase card you need to use it wisely.

Most importantly, you must do all you can to clear your card before the 0% period ends, or you will get charged interest. As the annual percentage rate (APR) which kicks in at the end of any promotional offer could be costly, monthly costs could soar. (The APR is the total cost of the loan – including both interest as well as any fees and charges).

You need to be disciplined about paying off your balance by this date to avoid getting caught up in a debt spiral.

Other tips for using a purchase credit card wisely:

  • Only get one of these cards if you can afford the monthly repayments
  • Aim to make more than the minimum payment each month – better still, clear the card in full each month to avoid paying interest
  • Never miss a payment, or you could face a fee and could find any promotional offer gets withdrawn. You also risk harming your credit score
  • Always stay within your credit limit. This is the maximum amount you can spend on your plastic each month. Breach your limit and you could face a fee
  • Avoid using a purchase card to make cash withdrawals, balance transfers or transactions abroad. These  don’t count as a ‘purchase’ so you will be charged interest. Check the Ts and Cs

Take care when applying

When applying for a purchase credit card (as with any piece of plastic), your financial circumstances will be assessed.

The very best deals will be offered to those with the highest credit ratings. If you have a lower score, banks may be cautious about lending to you.

It’s important to note that providers only have to offer their market-leading card deals to at least 51% of applicants. With a poorer score, you may get offered a shorter interest-free period, and a lower credit limit.

Before making an application, it’s worth checking your credit report. You can do this with our Credit Monitor tool.

If you have a low score, it may be worth pausing your applications for a time, and taking steps to boost your score so you can get a longer interest-free period at some point further down the line.

Read more at: ‘How to improve your credit score quickly.’

Avoid a scattergun approach

Don’t apply for lots of different purchase card deals in a short space of time, as each application will leave a ‘mark’ on your credit file, and this could damage your chances of getting the best credit card deals.

Use our eligibility checker to see which cards you are likely to get approved for without doing any harm to your credit score.

Remember you get Section 75 protection

Another advantage of using a credit card to make a purchase, such as an item of furniture or a holiday, is that you get protection under Section 75 of the Consumer Credit Act.

This safety net means the card company has equal responsibility with the seller if there’s a problem with the things you’ve bought, or if the firm you’ve bought them from goes bust.

Read more here.

What are the alternatives?

If you want to consider other options alongside purchase credit cards, a personal loan is a more structured way of borrowing a sum of money. You get a set interest rate and an agreed period of time over which that money must be repaid

While rates tend to be lower than on purchase credit cards, you won’t get an interest-free period.

The right answer for you will depend on your individual circumstances. You need to weigh up which product is best for your needs.

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