CC interest -mathematical wizard please help!

lotto-dreamer · 9 January 2007 at 7:47PM

:mad: Help! I am so angry.

(Dates taken from statement so they had received these amounts then)

11 Dec - I paid Royal Bank of Scotland credit card payment of £90 -paid slightly more than min payment which was £82

13 Dec - Paid full balance outstanding (according to RBS) of £3,810.58 and closed account. However, I discovered the £3810.58 did not take into account the £90 already paid two days earlier. According to my calculations I should have received £90 back for overpayment and person I spoke to at that time agreed. They also agreed to close the account.

RBS have now sent me a cheque (received today 9th January) for £42.50 and have DEDUCTED interest of £47.50. WHAT FOR?????

(Their rates are 1.527% per month interest)

Is this correct? It seems extortionate to me. Help, (maths not being my forte I am a bit confused but it seems outrageous) No interest paid to me on the in-credit amount they've had since 13 December !!!!:o

oldfella · 9 January 2007 at 8:02PM

thats about 3 weeks interest on the amount - when did they apply your payment to your account?

Mike

CLAPTON · 9 January 2007 at 8:07PM

its probably the interest from the statement date to the payment date
what was the statement date?

lotto-dreamer · 9 January 2007 at 8:18PM

According to my statement of 16th OCTOBER:

Bal from previous statement -3652.85
12 Oct - PAID 90.00
16 Oct - Interest 54.79
16 Oct - Payment protection -28.58

According to my statement of 16th DECEMBER:
bal brwt fwrd 3646.20
19 Nov - debit 34.98
19 Nov - debit 18.91
30 Nov - debit 110.49
11 Dec - PAID 90.00
13 Dec - PAID 3810.58
15 Dec - Interest 47.50

I am just a bit thick with maths - so would really appreciate some help!:o

RTNI · 9 January 2007 at 8:20PM

lotto-dreamer wrote:

:
RBS have now sent me a cheque (received today 9th January) for £42.50 and have DEDUCTED interest of £47.50. WHAT FOR?????

(Their rates are 1.527% per month interest)

If you have cash advances or a BT that is not at 0% then the interest could have come from there. The interest may be charged on a daily basis. Meaning from the date your statement was printed, until the balance was paid off in full, interest would be charged.

Did you have any cash advances or BT's on that full balance of £3810.58?

edit: Assuming that you had a statement produced on the 16th November, the interest would be charged from then until the day yuor account was paid off in full (ie the 13th december). Thats about 4 weeks, so the interest is not as big as you r previous statement, but has gone down as you paid the full bill 3 days before the bill would be sent out (16th).

Hope this helps.

lotto-dreamer · 9 January 2007 at 8:24PM

No cash advances and no BTs- interest is as it is stated for purchases only which is 1.527%

edit: frantically looking for statement of November -cannot find at the moment -

but, what frustrates me is that when I asked for full amount outstanding I did not expect to be then asked to pay evn more.

-equally annoying is they haven't given me any interest on the monies they've held over and above what was due to them (no doubt their T & C's sorts that out to their advantage)

Aaaargh......I think it would help if we had a forum dedicated to basic maths particularly with how interest works....

Thank you to you all for your advice and help anyway.

CLAPTON · 9 January 2007 at 8:58PM

basically when you asked them for the balance they added up the opening balance plus the 3 debits making 3810 (add it up it checks out) ... because that would have been on their system.
However when you closed the a/c they then added the interest from the 16 Nov to 13th Dec which is approximately correct. (otherwise if you hadn't closed it , it would have been on the next regular statement

I'm sure if you read your T&Cs it will say something like that.

its about right and how most CC work.

lotto-dreamer · 9 January 2007 at 9:18PM

Thanks Clapton - that does make sense. I can see how it has been worked out now. I've taken a deep breath and calmed down.

It is a good lesson - when paying off credit card balances in full -final figure given may not include final interest charges!!

I still wish I had a better grasp on how interest is applied etc - but I'm really grateful to you all for responses and help received.

lotto-dreamer · 9 January 2007 at 9:18PM

sorry -posted same reply twice (not quite calmed down yet! but nearly there)

jamalfatty · 9 January 2007 at 11:46PM

Its called residual interest and as its the first time you have paid balance off in full it is from date of previous statement (i.e. your november one) until date you paid balance off in full as between these 2 dates you were borrowing money from them.
When paying a card off in full for first time, you should always include est. interest in your payment to make sure it is properly cleared

lotto-dreamer · 10 January 2007 at 12:06AM

I was so disappointed not to be getting my £90 back- but as you have all now explained it so well and, as unpalatable as it is, it does make sense and I no longer feel ripped off.

Thanks again, I'm really grateful (and a little wiser about interest on credit cards)

CC interest -mathematical wizard please help!

Comments

Confirm your email address to Create Threads and Reply

🚀 Getting Started

Categories

Is this how you want to be seen?

Get our FREE Weekly email full of deals & guides - and it’s spam-free