How to pay off cash advance quickly?

SideKick

Today I made a stupid mistake when getting some foreign currency at a local travel agent.

I meant to use my debit card, but instead used a credit card.

I normally pay off my credit card each month and so never have to pay interest on the account. However I realise that I will have to pay interest on the cash advance, plus a cash advance fee.

What I have now done is to pay (through my online bank) the current credit card outstanding balance on my cc statement plus the cash advance and what I calculate will be the cash advance fee, plus a few more quid for luck. As far as I know I have no other outstanding purchases on the card.

My question is, will this clear the debt on this card as soon as they receive the total payment? - and if I make any further purchases on the card after this, will they affect anything?

Many thanks

YorkshireBoy

SideKick wrote: »

My question is, will this clear the debt on this card as soon as they receive the total payment? - and if I make any further purchases on the card after this, will they affect anything?

To be on the safe side (especially if it's a Barclaycard), I'd wait until you receive a statement showing a slight positive balance (if you've done your sums properly ) before resuming spending on the card.

SideKick

It isn't a Barclaycard - it is a Nationwide CC. This is a bit unfortunate as I am going on a foreign holiday and wanted to use that CC for paying the hotel bill because of the very favourable rates that NW give for paying in Euros.

But basically, once my balance goes positive at anytime, then I am OK to make further purchases. I don't have to wait until I get the next statement?

I am really kicking myself for being so careless.:mad:

dag_2

I'm with Yorkshireboy; to be on the safe side, send off the money to pay the card straight away, and then wait until you've got a statement showing a zero or positive balance before spending on the card again.

If you don't wait until you've got a statement, then you might find that they allocate the payment that you've already made to the purchases that you haven't yet made! And you may even fhat the T&C's cover them for this. I could be wrong on this, but I suspect that most credit card billing systems only make the decision about how payments will be allocated at the point that the statement is raised; they're not done on the fly as payments come in.

Of course, if you're absolutely sure that you want to use that particular credit card to pay your hotel bill, then what you could do is pay off not just the current balance and cash withdrawal, but also pre-pay an amount to cover all the spending that you anticipate putting on your card between now and the next statement date. This may result in losing out on more interest on leaving the money elsewhere, but it would totally eliminate the potential problem of being charged extra interest for rolling the cash advance over. Provided, of course, that your spending for the rest of the month doesn't exceed this prepayment.

nomoneytoday

IME Nationwide have a positive payment hierarchy and so you shouldn't be penalised harshly.

However, as you know they fx rate they would have offered locally for cash withdrawals would possibly be better than the Bureau de Change, even allowing for the £3 withdrawal charge

(AFAIK many BdC work on a 6-12% margin)

NickX

dag wrote: »

If you don't wait until you've got a statement, then you might find that they allocate the payment that you've already made to the purchases that you haven't yet made! And you may even fhat the T&C's cover them for this.

As YorkshireBoy suggested this is the case with Barclaycard.

Nationwide tends to be fairer to the customer and I know that they do pay off the more expensive debt first, so the OP may be ok but I wouldn't like to guarantee it without speaking with Nationwide first.

NickX

nomoneytoday wrote: »

IME Nationwide have a positive payment hierarchy and so you shouldn't be penalised harshly.

Yep I think you are right, but the OP should double check with Nationwide or look at the Terms and Conditions they have just to be sure.

SideKick

Thanks all, I phoned NW CC to clarify, they said that I will be OK to make further purchases as soon as the current balance is paid in full.(Should be a couple of working days).
I couldn't check with them what the actual current balance because I am not the primary card holder... and the online access does not show either the cash advance or the payment sent today, but only the balance which I knew about from my latest statement.

They did clarify that interest payable is only on the cash advance, not the entire balance. As the cash advance was a fairly small sum, then I am less worried of the consequences.

I must say they were most helpful. I just transferred a few more quid to the CC to be absolutely sure that the debt is wiped off.