How to Save Big in the Bank Holiday Sales

Posted by Kiah Phillips in Personal Finance on 26 April 2018

Bank holidays may not guarantee a day of sun-soaked fun, but as is British tradition, we’d probably be quite happy barbecuing in the snow if it came to it. But no matter what your plans are, if you want to grab a bargain, you can use the Bank Holiday sales to save some serious money.

The obligatory bank holiday sales are the perfect opportunity to find products that might normally be too costly. To make potential purchases more affordable still, you can choose to buy items using a credit card or in-store finance rather than cash and spread the cost over a longer period – often at 0% interest. But to give yourself the best possible chance of being accepted for finance, you’ll need to make sure your credit file is in good shape beforehand.

That’s where checkmyfile can help. You can try us free for 30 days and then it’s £14.99 a month afterwards, which you can cancel at any time online, or by giving us a call or sending an email. You’ll get a good idea of what your credit rating is and be able to check that everything held about you is correct.

Using your credit file to make sure you get the best deals

In simple terms, the information held about you on your credit file is used by prospective lenders to determine how risky lending to you might be - based largely on how you’ve managed credit agreements in the past - and subsequently, whether you’re the sort of customer they are looking for.

It goes without saying that some credit checks are tougher to pass than others – a mobile phone contract vs a mortgage being an obvious example – and in addition, different lenders will have different criteria. But in all cases, the information held about you and your credit history will be the main factor in determining whether you get accepted or not.

It doesn’t just boil down to a ‘yes or no’ either. Many lenders operate something known as ‘rating for risk’ where the APR that you are offered (if you are accepted) will vary, often by a considerable amount. This is used where the lender basically says that they will extend finance to you, but you’ll have to pay more than the ‘Representative Example’ that will adorn most marketing messages and point of sale adverts. Put simply, the better your credit rating is, the less you’ll probably be asked to pay.

Store finance vs a credit card

Store finance is used by retailers as a way of securing sales from people who can’t or don’t want to pay for something up front. Many deals even offer 0% finance for a fixed period, meaning that you won’t pay more than the retail price. Credit agreements are often administered by a third-party finance company, and where interest is charged, it can be at quite a high rate.

When it comes to credit cards, there are products to suit most needs, with the ‘0% on purchases’ probably being most applicable for spreading the cost of a big purchase. These generally offer 0% (or a very low rate) interest for a fixed period, allowing you to pay something off over a longer period without incurring extra charges.

The big difference between the two is immediacy. Whereas with store finance, you can walk into a shop, see something you want and – assuming you pass the credit check – secure the product you want there and then, using a credit card to pay for something takes a bit more planning. Even Amazon hasn’t quite perfected same-day credit card delivery just yet.

A credit card is likely to give you extra flexibility in terms of managing your payments and being able to use it to buy more than one thing, but at the same time, you won’t know what your credit limit is until you are accepted, so there’s a chance it won’t be big enough to purchases the thing you have your eye on. It could all come down to your appetite for an impulse purchase.

In both cases though, the same thinking applies – apply without knowing what your credit report says about you and you could be left either staring frustrated at a ‘Sorry…’ message on an online application form, or slightly red-faced in a store standing next to a disappointed sales assistant.

So how can I prepare for an application?

These days almost all credit checks are automated, including store finance – the only difference between that and a credit card application is that it’ll be someone in the shop entering your personal information, rather than yourself.

Different lenders will use different Credit Reference Agencies and so knowing what’s held about you by more than just one is a big advantage (only checkmyfile lets you do that).

As well as your repayment history, the ‘public information’ held on your credit report will play a big part. Your Electoral Roll status and whether you are listed at your current address (with the agency that is being checked) carries a surprising amount of weight and can easily make or break a decision. Similarly, any court information will have a significant impact on the decision they come to.

That means if your Electoral Roll listing is missing, or negative court information is returned, then you may find yourself being declined straight away.

If you aren’t listed on the Electoral Roll, it’s not too much hassle to get your listing updated to reflect your latest address and it could make a big difference to your application – it might just mean waiting until the next sale before making that big purchase.

To make sure your credit report is in the best possible shape for being approved, no matter which method of purchasing power you prefer, you can try checkmyfile FREE for 30 days, then £14.99 a month afterwards – you can cancel at any time online or by phone or email.

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