Help with interest rate calculation

weebubbles

Hi, I have a Sainsburys credit card and owe £4323. I am going to transfer most of this balance to a credit card with a cheaper interest rate.

I am charged £11.36 on a promotion rate of 0.016% a day and charged £47.48 on a purchase rate of 0.073% (29.95% pa).

My question is how do I work out how much of the £4323 I am charged at the promtion rate and how much of the balance I am charged at the purchases rate?

Moggles_2

If it's not a daft question, how would this help?

Unless stated otherwise, you can bet that payment sent by the new credit card will be allocated to your outstanding balance in a way that benefits Sainsbury's, not you. (For this reason, it's not a good idea to take up special offers, when you have existing transactions charged at your standard rate.)

Credit limit permitting, I would transfer the entire Sainsbury's balance to the new credit card. Most lenders will allow you to borrow up to 95% of your limit, but I'd check your Ts & Cs as one or two restrict you to 90%

LBG_worker

Yep I am afraid Moggles is correct - All your payments will go towards your cheapest rate first meanwhile your purchase interest piles up and you will continue to accrue interest upon interest. Just a quick thing to note you dont mention who you are balance transferring to? Its just that Sainsburys bank uses HBOS to service its credit cards so if you are planning to transfer to a HBOS card they wont let you. Just something to consider before you apply for another card.

AdamGrif

If you phone Sainsburys up they will be able to tell you how much is sitting on what rate. As has been said previously though, your repayments back to the card will be allocated to rates attracting the lowest rate of interest first.

CLAPTON

the answer is that you have about 2256 being charged at 0.016% per day
and about 2066 being charged at 0.073% per day