Payment Allocation

money_saving_novice_6

Hi everyone.

Ok so here's the problem - I spent £X amount on my Barclay card platinum, which has 0% on purchases for 3 months. I also get 0% on balance transfers for 12 months.

I wanted to make a balance transfer of £Y in September and so I made a payment of £X and, once I had logged in online and saw it had reached Barclaycard and the balance on my account was zero, I made the transfer.

Now, it looks like the payment I made has been allocated to the balance transfer, even though the statement clearly shows the payment was made before the balance transfer. Hence I've basically been caught in the 'never spend on a balance transfer card" without knowing!

Any ways out of this?!

YorkshireBoy

money_saving_novice wrote: »

...once I had logged in online and saw it had reached Barclaycard and the balance on my account was zero, I made the transfer.

There's your mistake. I believe with Barclaycard you need to wait for a zero balance statement to be produced first, in order to ensure the payments don't go towards the BT and leave your purchases locked in at 12.4%(?) APR.

Any ways out of this?!

Depends, to a large extent, on the values of 'X' and 'Y' (and the fee paid for 'Y'). Are they a secret, or can't you remember?

LuSiVe

Anyone know if this applies to MBNA/Bank of America too?

My amazon card has 0% on Amazon purchases until July next year and balance transfers till October. I had to make an initial amazon purchase to get the £15 credit but immediately made a payment and now want to do a balance transfer.

Do I need to wait for a statement or should I just accept that I need to pay off the balance transfer by July too?

BenL

Wait for the statement LuSiVe to show you are clear.

LuSiVe

I probably won't wait for the statement as the card the money's on at the moment will need it moved before then

It's not that much, only £500, so I can pay it before July ...

YorkshireBoy

LuSiVe wrote: »

Anyone know if this applies to MBNA/Bank of America too?

Condition 2f explains what happens when you have two 0% promotions running concurrently.

If your T&Cs are the same as the standard (these days) MBNA T&Cs online, any payment you make during the first 3 months will go towards your purchases (because that's the 0% offer that expires first).

So in theory, you might be able to make the BT now. However, and bearing in mind any 1st 30/60/90 day clause for the BT, you may wish to wait for a zero balance statement to be produced first.

money_saving_novice_6

YorkshireBoy wrote: »

There's your mistake. I believe with Barclaycard you need to wait for a zero balance statement to be produced first, in order to ensure the payments don't go towards the BT and leave your purchases locked in at 12.4%(?) APR.Depends, to a large extent, on the values of 'X' and 'Y' (and the fee paid for 'Y'). Are they a secret, or can't you remember?

No not a secret! X is around £1500, Y is around £4000 and the fee was £110. Will the amount really make a difference?

Very annoying if I can't escape from it. Am going to try giving them a call - will keep you all updated as to outcome.

If not only have the option of either just paying off as much asI can each month until cleared and accept the fact I messed up and pay interest or I can balance transfer the whole lot to a new 0% card before interest is charged. Will have to do the math to see what costs more - the BT fee or the interest on £1500.

LuSiVe

YorkshireBoy wrote: »

Condition 2f explains what happens when you have two 0% promotions running concurrently.

If your T&Cs are the same as the standard (these days) MBNA T&Cs online, any payment you make during the first 3 months will go towards your purchases (because that's the 0% offer that expires first).

So in theory, you might be able to make the BT now. However, and bearing in mind any 1st 30/60/90 day clause for the BT, you may wish to wait for a zero balance statement to be produced first.

Thanks for that, I've now looked at the page for the card on amazon.co.uk and it says ...

"If you do not pay your balance in full we will use your payments to reduce lower rate balances before higher rate balances. If promotional rate balances are the same we will repay them in the following order: first, the one with the earliest expiry date; if the expiry dates are the same then the one which started first; if the expiry dates, and start dates are the same then the one with the lowest standard rate. "

... so I think I'm safe, although I'll try and wait for a statement.

NickX

money_saving_novice wrote: »

Now, it looks like the payment I made has been allocated to the balance transfer, even though the statement clearly shows the payment was made before the balance transfer.

Provided that chronologically you have definitely repaid the Purchases balance in full before initiating the Balance Transfer I think you have case to complain to Barclaycard.

I have certainly done similar before on several occasions and not been penalised like this. But I would read your Terms and Conditions carefully before going in too heavy.

I have heard that you are best to wait for a Zero balance statement, so when I have done this I have called the provider first to confirm that the payment will not be taken from the Balance Transfer in anyway. Naturally I have noted their name and the time of the call so that if they did penalize me I would be able to make a complaint with evidence.

Good Luck and let us know how you get on.

money_saving_novice_6

Just got off the phone with Barclaycard after spending half an hour speaking to call centre in India trying to explain the situation to them. Surprise surprise they could not comprehend what I was saying and assured me everything on my account was fine - great help that was!

Ended up calling the Customer Relations Unit on 0844 556 0104 where the woman told me, in short, that there was nothing I could do. Any payment received within a statement period is classed as a pre-payment towards that statement balance and thus was allocated toward the balance transfer made later that month, in line with the allocation of payments policy detailed in the T&C.

Interest will be charged on my purchases at 2.075% per month - which is around £30 a month. A BT to my Virgin card will clear the BT I made to the Barclaycard and some of my purchases, for a fee of c.£100. Plus the c.£30 a month for the three months it'll take me to clear the payments means this has cost me c.£200.

Warning to all - make sure you have a zero balance statement before making a BT! And don't rely on Barclaycard customer services!!

Thanks for the advice guys