Point shopping

Discussion in 'Money Management & Banking' started by Noobieboy, 21st Jan, 2018.

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  1. Noobieboy

    Noobieboy Well-Known Member

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    I’ve been point shopping for a few years. Where you sign up for a card to get points (Qantas and what not). Now as I’m planning to move into property I’m been told that this could affect credit rating. True?

    I have a friend who does it as well. And he has been approved for 4 properties on fairly average income. Apparently all you need is to explain the situation to the bank. But that was before current credit tightening round.

    Plus the free points are sooooo good. Should I stop it?
     
  2. sash

    sash Well-Known Member

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    Ya should start a thread on how to be a point hacks extra-ordanaire...I am curious on how this works....and youse strategies....
     
  3. Noobieboy

    Noobieboy Well-Known Member

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    Its fairly easy really. Hunt down cards that offer bonus points (the more the better). Theoretical example: A bank offers 70K points (about $500 worth) to new customers for taking a credit card and spending $2,500 in three months. You apply for this card. Get approved, meet the spending limit, cash out the points. Close the credit card. Done. Move to next bank offer.

    Usually they come with caveats, like you must be a new customer or haven't held a card with this bank for the last 12 months. So reading T&Cs is important.


    Example, Westpac is offering a 100K points now. Here on average (and differs from place to another) but 5K points = ~$25
     
  4. noogie60

    noogie60 Well-Known Member

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    Card rewards are becoming a lot less generous with the reduction in the interchange fees mandated by the RBA.
    Cycling through introductory offers can work but I'd just find it too much paperwork and hassle (I have a lot of direct debits through my cards as well as a direct debit to pay off the card balance)
    It's stuff like Amex with a high transaction fee that still offers generous points.
    I have one colleague that does very well out his cards (I think he pays his children's school fees from his amex) and regularly scores hotel room upgrades, free car hire, etc
     
  5. Noobieboy

    Noobieboy Well-Known Member

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    Yep. I think it will soon become something of the past. Which is fine, as these pint offers were used to take advantage and "lock in" a lot of people who could afford to get off the card later.

    And they are much less generous. I agree. Nowadays its almost impossible to find a card with first year fee waved.
     
  6. Noobieboy

    Noobieboy Well-Known Member

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    The question is: Do you think this affects home loan outcomes down the road? :D
     
  7. pwnitat0r

    pwnitat0r Well-Known Member

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    Yes, of course.
     
  8. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    LVR and balance of score will have a lot to do with it as well.

    the core issue with many score systems, it can see one has applied for 6 cards in 18 mths, yet now we have only declared on.

    Two reasonable assumptions........................

    • Applicant is telling porkies and has more liabilities than declared
    • Applicant was declined for 5 out of the 6 apps


    Positive scoring which is gradually coming in will remove a lot of the guesswork for lenders and unclothe the realities- for some that will be great, for others .........oh oh.

    ta
    rolf
     
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  9. Noobieboy

    Noobieboy Well-Known Member

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    Awesome answer. Thanks Rolf. So if the cards have been long cancelled (cancelled as soon as points cashed out within say last 18 month as in your example).

    What would be the best approach? The issue saying you have the cards is inaccurate...
     
  10. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Id get a copy of my credit file

    then sit with a broker to see what the best option may be.

    this is assuming the enquiries present a challenge ......... for most sub 80 % lends with okish other history 2 or 3 unsecured credit enquiries arent a challenge

    Retain all closure letters............ in need use a lender that doesnt AUTO score and has LMI DUA............

    ta

    rolf
     
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