Halifax Clarity Credit Card 17.95% APR

northernstar5

I've just applied for a Halifax Clarity Credit Card at my local branch and been accepted, but at 17.95% not 12.9%.

Has this happened to anyone else? The branch wasn't able to give any explanation for this higher rate.

youknowwho

yes, it's because it's a typical rate. Which means is typical of your financial circumstances. 2 out of 3people get 12.9% the other 3rd get either 17.9% or 21.9%. It's all about price for risk, the higher the risk, the higher APR you get given. Don't take it to heart, the fact you got accepted is good news :-)

Ash1982

Yeah, I've got a good credit history and they have given me a £2,900 limit at 21.9%

Not sure why but I dont let it bother me, just pay off in full each month and taking cash out abroad with no fee will work out at about 1% in interest over a 2 week holiday so it's still better than most.

I think they may have taken into account that I have had a Halifax card before and NEVER paid them any interest.

northernstar5

Ash1982 wrote: »

Yeah, I've got a good credit history and they have given me a £2,900 limit at 21.9%

Not sure why but I dont let it bother me, just pay off in full each month and taking cash out abroad with no fee will work out at about 1% in interest over a 2 week holiday so it's still better than most.

I think they may have taken into account that I have had a Halifax card before and NEVER paid them any interest.

I've been reading on other threads about taking out cash on this card - but they all seem to be looking at it in relation to the 12.9% rate

wlf

I got the 17.9% rate, for no obvious reason.

Even at that it will work out as the cheapest option for overseas cash withdrawls, which is my main use for it.

kexas

How would it work with Halifax Credit card? If I pay back all the money, as soon as I'm back from the holiday would they still charge me?

What if I put money onto my credit card prior the holiday and balance is say +£200. Technically I'm not borrowing from them, so they cannot charge any interest on the top.

scottishblondie

kexas wrote: »

How would it work with Halifax Credit card? If I pay back all the money, as soon as I'm back from the holiday would they still charge me?

What if I put money onto my credit card prior the holiday and balance is say +£200. Technically I'm not borrowing from them, so they cannot charge any interest on the top.

As far as I know keeping a credit balance on the card isn't allowed. Using it as a credit card would not incur any charges as long as you pay it off in time, but withrawing cash attracts interest from the day you take it out AFAIK.

lisyloo

If I pay back all the money, as soon as I'm back from the holiday would they still charge me?

Yes, but a very small amount and the cheapest around.

What if I put money onto my credit card prior the holiday and balance is say +£200. Technically I'm not borrowing from them, so they cannot charge any interest on the top.

It's against the terms and conditions.
They may well send your money back.
Alternatively if you're unlucky they might stop your card and then you'll be stuck with higher fees for your holiday money (or worse case no card).
There is also some debate about what happens if your money was used fradulently.
ChattyChappy insists they would be liable and his evidence looks good, but Nationwide told me they wouldn't insure your money so you could have a huge fight on your hands with that (even if you do eventually win).
So I would advise against it.

Pay it off as soon as you return to minimise interest.

If you are really bothered you could find an internet cafe to pay it off or you could set up a series of BACS (internet banking) transaction to pay it off in advance and try to guess it as best you can.

Easiest all round is forget about it till you come back and pay teh smallest cheapest fees around.

Jakkals

My partner applied for the 12.9% rate card and was sent an approval at 17.9%. Her branch told her it had to do with her credit rating. If that means she represents a high risk customer that's nonsense since she pays all her bills in full and on time. We suspect that her good record is the problem -- they will make little or nothing on purchases she makes with her card and so they're insisting on a higher rate just in case she uses the card for a cash advance; then they can start charging immediately and want to grab 50% more interest than the 12.9% they have in large type on all their ads for this card. The course the Halifax took on business ethics must have been a very short one. For the naive consumer like me, there's a lesson here: "typical" is a code for "at least." When will bankers stop misleading us?

opinions4u

Jakkals wrote: »

My partner applied for the 12.9% rate card and was sent an approval at 17.9%. Her branch told her it had to do with her credit rating.

You have the explanation for this within the thread that you've posted on. #2 looks most helpful.

If that means she represents a high risk customer that's nonsense since she pays all her bills in full and on time.

Okay, my numbers may not be current, but they were once around the numbers typically accepted or declined on a 3 tiered credit card.

1. 34% of applications are accepted at the advertised rate.
2. 8% of applications are accepted at the middle rate.
3. 8% of applications are accepted at the highest rate.
4. 25% of applications are declined based on Halifax credit scoring.
5. 25% of applications are declined due to Halifax interpretation of external credit reference information (e.g. CCJ, default etc).

We suspect that her good record is the problem -- they will make little or nothing on purchases she makes with her card and so they're insisting on a higher rate just in case she uses the card for a cash advance; then they can start charging immediately and want to grab 50% more interest than the 12.9% they have in large type on all their ads for this card.

It's all a massive conspiracy isn't it. Do you really believe the nonsense you've just typed? She's in the top 42% of applicants. She's ok.

The course the Halifax took on business ethics must have been a very short one. For the naive consumer like me, there's a lesson here: "typical" is a code for "at least." When will bankers stop misleading us?

They have complied with FSA standards on two thirds of successful applicants qualifying for the advertised rate.

They have offered her a credit card and they have made it absolutely clear what terms they have offered it on. If this business arrangement isn't acceptable the "your right to cancel" section of the paperwork may be of interest. Tesco were selling 3 pairs of scissors for £1 when I was in at the weekend. They looked good enough to deal with plastic cards.

Perhaps they should have just declined your partner. Would that have been preferable?

fozmcfc

My Halifax card (not a Clarity, but a One card) was issued at 21.9%, despite the fact I have a very good credit record.

But just paying everything ontime isn't of course the only factor.

In my case, I believe it was because I now have a lot more credit available to me, then when I took out my 2 previous cards both of which have an apr of 16.9%. It stands to reason that as I now have much more credit available to me if I maxed everything out, that I am more of a risk, even though my history of the past few years suggest overwise.

Even if I keep my credit record spotless until the end of 0% period, unless I close down a couple of my cards, I'm unlikely to get accepted as I now have over 50% of my salary available to me on credit cards.

I'm only using mine for the 0% purchase rate anyway and then clearing it before it runs out, so the APR doesn't matter.