Martin Lewis has issued a warning about a common credit card mistake that could harm your credit score. The money-saving expert appeared on ITV's This Morning to share his two essential rules for applying for credit cards, particularly when considering a balance transfer.
Lewis explained that the key tool for tackling credit card debt is a balance transfer, where you move your debt to a new card offering 0% interest. However, he stressed that you should never apply for a card without first checking your eligibility. 'Do not just apply,' he said. 'Get yourself onto an eligibility calculator on a comparison site, because if you apply, it puts a mark on your credit file.'
He advised using an eligibility calculator to see which cards you are most likely to be accepted for, as this does not impact your credit score. When choosing between cards, Lewis recommended selecting the one with the lowest one-off fee within a long enough 0% period. For example, TSB offers up to 38 months at 0% with a 3.49% fee, while Barclaycard provides up to 14 months with no fee.
Lewis also highlighted that using a debit card to avoid credit card interest can be a mistake. Overdrafts often carry higher interest rates than credit cards, and credit cards offer additional protections under Section 75 of the Consumer Credit Act. He advised that if you must owe money, a credit card is often the better option, provided you pay it off in full each month.
