Virgin, Balance Transfers, Retail Purchases & insanity

alanrowell

I recently got a Virgin CC (adminstered by MBNA) with 0% on Balance Transfers & cheque usage for which I used as large part to put into a high interest savings account

I made one other transaction on it which I expected would accrue interest IF I didn't pay the transaction before the date on the Credit Card statement.

I received my statement & it charges interest from the date of the purchase (like a cash advance) until the date I clear ALL the statement - in this case £10,000

I can stop the interest payments by taking the money from the high interest account & using it to pay off the Credit Card bill and then the day after do another balance transfer putting the credit card bill& my high interest account back to where it was.

If I'd done a balance transfer into my bank account and then paid the retailer from that I wouldn't have paid any interest

If I'd used a CC cheque I wouldn't have had to pay any interest.

Only by using the card as normal do I get interest charged

Insane or what, as all it means is that once the interest free period is over I cut up the card rather than been a user of their card in future

smartsaver

Although I can see your point... We are using credit cards to our advantage. You can't really expect them to make is easy for us.

You can only use the card for purschases if purchases are 0% too. Personally I do my BT or SBT and never touch the card until the 0% offer ends.

I don't think the Credit card companies are insane.. Just making us work a little harder.

Reaper

alanrowell wrote:

I made one other transaction on it which I expected would accrue interest IF I didn't pay the transaction before the date on the Credit Card statement.

I'm afraid you fell into the classic trap. Pretty much every credit card uses any money you give them to pay off the cheapest money first. Have a read of Martins articles on the main site as he warns about this. It is spelt out in the T&C too (but Martin's articles are a much easier read).

The simple answer is to have one card for spending (typically a cashback card which you pay off in full each month) and other cards purely for balance transfers.

zx2011

You need to read your card's terms and conditions carefully. Also the new summary boxes now outline the order of allocation of payments.

Here's what Virgin say about their "Got a balance to transfer?" credit card:
How your balance is paid off:
Items at lower rates of interest on your statement will be paid before items at higher rates of interest.

For information about summary boxes see: https://www.summarybox.info