Credit cards can be convenient for some everyday expenses connected with moving, furnishing or maintaining a home, but they should be used carefully. Property buyers should separate short-term convenience from long-term borrowing because credit-card balances can become expensive when they are not cleared on time.
Know what the expense really costs
Before charging a property expense, check the interest rate, fees, repayment terms and any foreign-currency charges that may apply. A discount or reward is not necessarily valuable if interest later outweighs the benefit.
Protect your home-buying budget
If you are saving for a deposit, avoid allowing discretionary card spending to reduce the cash available for the purchase. A realistic property budget should include the deposit, transaction expenses, repairs and emergency reserves.
Use cards for manageable expenses
Where appropriate, a card can be useful for smaller, predictable purchases that you can repay according to the card terms. Avoid using high-cost revolving debt to finance a property purchase without understanding the consequences.
Frequently asked questions
Should I use a credit card for a house deposit?
Do not assume this is acceptable or affordable. Check the lender’s requirements and your card terms before using borrowed money for a deposit.
Can credit-card debt affect a mortgage application?
Existing debt can affect a lender’s assessment of affordability. Ask your lender how your current obligations will be treated.
What should I compare before using a card?
Compare interest, fees, repayment timing and the effect on your wider monthly budget.
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