Halifax Card - Minimum Payment less than the interest

mrbigd

I'm paying alot on top of the minimum payment but have noticed that the interest applied on this account is more than the minimum payment.

Minimum Payment
£33.79
Interest
£48.30

Is this legal or quite honestly morally correct?

YorkshireBoy

Your minimum payment calculation method is...

...you must repay the greater of:

1% of the amount you owe us

or

an amount equal to the total of any Credit Card Repayments Cover premiums, Interest (or the minimum interest charge), overlimit and late payment fees plus £5.

Source: Halifax card summary box

However, you may find that they're using the last statement's interest figure in the second calculation, not the current one.

Perfectly legal?...yes. Morally correct?...doubtful (but it suits some people...me included).

david39

Similar situation to one I was in some time back with MBNA

I had a 0% balance transfer from another card while I also had a normal purchases balance on the MBNA card. Under the usual rules, any re-payments come off the 0% balance while the "trapped" interest-bearing balance continues to attract interest.
Depite the fact that you are paying money off the card, the interest charged increases each month.
When certain ratios of the size of the two balances are reached, the time comes when the minimum payment is less than the interest charged.

I later found this website that explained that the golden rule is never to take out a balance transfer onto a card with an interest-bearing balance already on it.

nomoneytoday

Please don't pay the minimum, at least pay the interest, or it will snowball later

mrbigd

nomoneytoday wrote: »

Please don't pay the minimum, at least pay the interest, or it will snowball later

Already paying well over minimum as stated in original post, just thought how wrong it was for some one not realising this!

vet8

I have recently found that several of mine and my OH's cards are making the minimum payment less than the interest. I did not think they could do that as they always say they will charge the interest plus a certain figure.