MSE News: Credit card payment trap ends

[Deleted User]

No. Now that the payment hierarchy has flipped, then the more expensive debt will be the one transferred, even if the previous transfer hasn't yet happened.

A month ago, you might have had a problem though.

Enigma80

If that is the case then that is excellent!

stphnstevey

Posted on Stoozing board as well, so either would do for an answer!

I don't have the brain power to work out what happens if you have promotional rates on BT and spending.

Say you had 6m 0% spending and 12m 0% BT, you BT say £3K and spent £500 in one month.

What happens?

Consumerist

For MBNA cards you can look at this post but some cards give overriding precedence to pay down balances which have appeared on a statement as opposed to those which have not. You'll need to refer to the Ts&Cs for the card you use.

It seems to me that the banks are going to do their best to keep us confused.

Hope this helps a little.

stphnstevey

So, at least while both purchases and BT's are at 0%, you could take the card upto the credit limit - a little extra for stoozers I guess as you normally only BT upto 95% of credit limit.

But if the durations of the promotions are different lengths, you have to be awake enough to pay off two amounts at two different dates

Consumerist

stphnstevey wrote: »

But if the durations of the promotions are different lengths, you have to be awake enough to pay off two amounts at two different dates

That's about the strength of it. You will need to time the settlement of the purchases balance to be exactly the same date as the promotion expires if you want to avoid interest charges altogether because interest will start to accrue from that date until repaid. If you pay it a day later then you will have one day of interest charges added to your next statement. If you pay it a day earlier then the payment will come off the transfers balance and not settle the purchases balance.

I think the banks are going to have some real fun with us until we get used to the way it now is.

stphnstevey

And I guess it's when the payment arrives there end, not when you send it, so even more difficult

Consumerist

It will be the date the payment is credited to the account that determines which balance is reduced/settled.

I think, in general, we will need to resign ourselves to having to pay some interest charges when 0%-purchases and 0%-transfers expire at different dates on the same card. . . Unless, that is, Faster Payments can be relied on in some future century.

Linda16

My Barclaycard STILL seem to be taking my payments from the cheaper debt before the cash withdrawal (withdrew in an absolute emergency on the way to airport after an expected payment didn't go in my account on time)
I have written to them a couple of weeks ago to ask why, and not received an answer as yet.
I assumed ALL my payment would go first to clear the cash debt... Barclaycard are dividing the payment, so much for outstanding balance and so much for cash debt.
Have I got it wrong?

Consumerist

I don't know the details of Barclycards Ts&Cs but it is possible you have been caught by the distinction between transactions which have already appeared on a statement and those that haven't.

If your cash transaction had not appeared on a statement when you made your payment then it is possible that the cash transaction was disregarded until it did appear on a statement.

You should check their Ts&Cs and the timing of your payment.