First Direct Gold Card Conditions

mrsean2k

Hi,

I was invited to apply for an FD Gold Card. I've been an FD customer virtually since the beginning, and I could do with a card with a long interest free period.

First, on carefully reading the conditions of the card, it seems that the interest free period on new purchases only kicks in if you make a balance transfer of at least £100 from another card within the first two months.

There is a 2.5% fee for the transfer and, as is so often the case, the way that credits are applied means that "new" debt is addressed first, and balance transfer debt last.

As I understand it, this means that if you want to use the card as interest free credit on purchases, there is a thinly disguised fee, being 2.5% on the original transfer (so 2.50 in my case) and then ~6% pa on the original transfer balance month to month.

I'd guess that the interest is cumulative, so I make that an extra £15 fee for access to interest free purchases.

So in the case of this card, I make that £17.50 for interest free purchases on a potential £8000 (the agreed limit).

This still seems like a good deal to me if you spend as much as you can on the card (I have an offset mortgage, so cash in the bank helps)

Could anyone check if I have my figures right?

Second, I considered paying off the 102.50 immediately and waiting until the card shows a zero balance on a statement before beginning to spend. Then there is *no* interest to pay, as the balance has been cleared before any further debits have been raised. Should that work?

And last, although I can make payments *from* the card online, I can't make payments *to* the card online from my other accounts. This seems to be a pretty clear tactic to allow the balance transfer amount to build up and for the window of opportunity to clear it off "cleanly" to close.

I've queried this with the bank, but others may just want to be aware that this is the tactic (likely old news here I guess :-))

YorkshireBoy

I have a guaranteed pre-approved offer for this card, but I'm not taking it out. Not that I think it's a partuclarly poor deal...just that I don't need 0% on purchases at the moment.

You're slightly out with your figures though...

Delaying the BT as long as possible will mean you only incur 10 months interest on the BT amount and it's fee.

Depending on your offset mortgage rate you may even make a profit on the fee!

I reckon your interest will be less than £6 for the remaining 10 months.

brookerbabyisababy

I am also confused by this FD offer. So if I transfer £100 to it - I get charged 2.5% - £2.50 then what happens to the £102.50 debt? - do they charge interest at 6% - how much is that altogether at end of the year????

I like how mrsean2k idea to : Second, I considered paying off the 102.50 immediately and waiting until the card shows a zero balance on a statement before beginning to spend. Then there is *no* interest to pay, as the balance has been cleared before any further debits have been raised. Should that work?

Can anyone explain this? Also do you have to pay minimum payments and do you receive paper statements?

mrsean2k

sofa_surfer wrote: »

I hope they are of some help:
http://forums.moneysavingexpert.com/showthread.html?t=1033813
http://forums.moneysavingexpert.com/showthread.html?t=884809
http://forums.moneysavingexpert.com/showthread.html?t=718709
although I can comment only from a 'slow-stoozing' point of view

Yes, the exact situation I'm in - must learn to search in here more carefully. Thanks!