A lesson learned.

Capyboppy

I am one of those people who always pays off their credit card every month and looks for interest free deals when needed. I had bought a couple of larger items that I had spread over 12 months on my Sainsbury credit card. During the last three months I realised I wasn't quite going to make paying the balance off, so after looking around took out the new M & S card. I always listen carefully and go through small print with a fine tooth comb, but this time it looks like I have goofed despite being so careful. I transferred the balance over no problem, and also spent on purchases to take advantage of the extra points for three months. When my first statement came I paid off all the amounts of my purchases, plus an additional amount to get my balance transfer down. I later made a further payment a week later. Today my second statement came with an interest charge of just over £5, and one purchase transaction outstanding. I rang them up to query this. To cut a long story short, apparently when they work out your payments, they go in order of priority. First any interest payments are deducted. (none on the first statement.) Next your balance transfer, then your purchases. This fact is very much played down, and I registered how annoyed I was, that I had transferred the balance with the view of paying it off over three months, along with using the card for other purchases. She told me that I had in affect, actually paid off my balance transfer, and the balance showing was the purchases. Also that this is clearly explained on the phone before acceptance. While this may be true, the speed they quote this at is so fast most people don't take every single word in. She was very sympathetic and said she would put my disatissfaction down to be taken into consideration with new customers. She also said that most people use balance transfers to transfer thousands of pounds, and use the scheme just to clear the transfer, and not such smaller amounts such as mine. Thankfully I shouldn't have to pay more than another three pounds in interest by the time I have cleared the total balance, but it has certainly opened my eyes, along with ruining my " I always pay everything off" record! I have always regarded myself so careful. So to conclude; Make sure you check the order in which the company regards your payments to pay off.

Robert_Sterling_3

A lesson learned the hard way!

Caped_Avenger

Unfortunate, but this is how they make their money, and a lot of card providers do it. They charge 0% on balance transfers, and either a discounted rate, or SVR on purchases, then any payments go against the balance transfer first. Yours is a cautionary tale that everyone should read and/or be aware of.

paultw5

Done similar a couple of years ago with virgin i think, bought some petrol. Managed to worm my way out somehow, (think i phoned and complained like you). At least it has'nt cost you much.....

Stonk

It's the cardinal rule of 0% BTs. If you use a card for balance transfers ... do not use it for anything else. Stick it in a drawer at home.

sicker

I never spend on a 0% card with the exception of Egg Money (it's in credit) for what should be obvious reasons. I hope others learn from your unfortunate exxperience.

John

PokerPortal

Stonk is spot on. It is unfortunate that this happened to the OP. This will now probably show up on your credit record for a short while I suppose?

YorkshireBoy

PokerPortal wrote:

This will now probably show up on your credit record for a short while I suppose?

Why would it? The OP has made more than the minimum payment, and made it on time.

I think the issue is simply "order of payments" isn't it?

Capyboppy

Why should it show up on my credit record as bad PokerPortal? Surely as I have paid way over the minimum £5 payment it shouldn't be seen as a bad thing. It is only if you miss a payment or don't pay the minimum payment things start going pear shaped.

Thanks everyone for your supportive replies. If this stops someone from making the same mistake with a lot more money than I had on my balance it will be worth it. In fact the voice on the other end of the phone came across as surprised I wasn't transferring thousands, instead of a couple of hundred!

PokerPortal

You are both correct YorkshireBoy and Capyboppy. I did not bring it as a statement but rather as a question, which you both answered. I guess I wasn't concentrating enough. :-)

YorkshireBoy

Capyboppy wrote:

...way over the minimum £5 payment...

I thought the M&S minimum payment was 3% of the balance.