Credit Card Deals for Signing up

Hey everyone

I've always been tempted by all the freebies you get for signing up to new credit cards. I've seen everything from a $200 gift voucher (DJs) to flights (Virgin Blue and Jetstar). The lady at DJs told me to just sign up to the card, use it once to activate it, and then cancel the card. The yearly fee was $99 so with the $200 gift card it would still have been a $101 profit.

What are the risks involved? I know it can potentially damage your credit rating but I don't know more than that. I don't know what my credit rating is and don't know how to check, although I assume it's ok.

Does opening and closing credit cards damage your credit rating, even if you always pay them off in full?

Cheers

Comments

  • From what I understand, your record stays in the credit system for 5 years when you apply for a new credit card. Even if you close it after a day of receiving the card, this record still remains in the system. Then when you try applying for a loan within this period, this record will be available when a credit check is performed on you. The more credit card applications you make (even worse if you have a lot of defaults/overdues), the higher your risk will be for the lenders.

  • Well they dont waive the $99 fee, so you pay cash for the $200 vouchers.
    Ive had a good experience with my DJ's card. A fair few offers in my first year, this one http://www.davidjones.com.au/everydayspend worth up to 15000 points was good for me (but porbably not eveeryone). theyve also offered 2000 points for each additional person (up to 2 people) i add to my account, but I didnt care for that one.

    Ill let someone else address the credit rating. it was dealt with on this post a bit http://www.ozbargain.com.au/node/20787

  • +1

    We got the DJ's card when buying a Sony TV, worked out quite well for us. Long interest free term, DJ's coupons (which we applied straight to the TV), store points for more coupons (again, straight onto the TV) and a free playstation from Sony. Once the TV is paid off we'll cancel the card, and it will have effectively just been an interest free payment plan with discounts on the principal.

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