Virgin 0% card query

sghughes42

I've just been accepted for a Virgin 0% card with the intention of doing a money transfer as a short-term loan.

One thing I was wondering, it offers 16 months on these transfers at 0% and 3 months on purchases at 0%. If I do any purchases will the be paid off first or will the payments go against the money transfer?

Assuming the latter and bearing in mind the new rules, could I end up with the whole amount of purchases being charged interest at the full rate once the three months is up? In that case, would the payments not go towards paying that part of the balance off first?

Basically, to summarise the question, should I just use this card for the money transfer or can I take advantage of 0% purchases as well?

pauljoecoe

sghughes42 wrote: »

Basically, to summarise the question, should I just use this card for the money transfer or can I take advantage of 0% purchases as well?

If you use it for purchases you will lose the 0% for the 16 months.

sghughes42

Out of interest, where do you get that from? Their homepage has the following:

If you have two or more promotional offers at the same rate, we will use your payments to reduce any promotional balance with the lowest standard rate last, even if this offer ends first. This could mean that any such balance may not have been reduced by the time the standard rate applies to it.

Which to me suggests you can have more than one offer and that you will keep the 0% for the period offered, i.e. 3 months for purchases and 16 months for money transfers.

It does imply that payments will be against the purchases first but I thought that the new rules coming out meant that they have to apply against the higher rate first? They can claim that both are at the same rate during the initial 3 months but surely once that is over the purchases become the higher rate so payments should be against them?

pqrdef

So long as purchases are 0%, they'll credit payments against the BT. It'll be tricky if not impossible to get any payment credited against purchases without first paying some interest on the whole accumulated purchase balance.

Interesting times ahead under the new rules.

drussellh

I would strongly advise you not to spend on a card you have transferred a balance to. Follow Martin's advice on this one !

speedbird1973

As the promotions start on the same date (account opening) the balance on the promotion that finishes first is reduced first. So you can use your 3 months purchases. So long as you pay off the value of the purchases I THINK you'll be ok

sghughes42

Must admit this is confusing me - I thought the new rules were that the highest rate had to be paid off first.

I can see them allocating during the 0% period to keep what will become the higher rate amount as high as possible but surely one it becomes chargeable at more then 0% any payments I make must be used to pay that off?

Mind you, to save potential hassle I may just get a little bit extra out on the money transfer - means a higher fee but less potential trouble to sort out at a later date...

twist-and-shout

Ok I work for MBNA/Virgin...please dont give me a hard time someone has to work for the company and it's not that bad really.

If you have 2 promotional balances at the same rate and the started on the same date you will pay off the one with the higher standard rate which in 90% of all cases will be a money transfer rate over a purchase rate.

I am very much certain this will be the case for a new account. So to answer your question if you were to do a money transfer and spend on the account any money you repay would be applied to the money transfer first.

You would not be able to avoid an interest on the purchase but you could limit the interest. ie. make sure that purchase was paid 1 day after it expired and that way you would only get 1 days worth of interest

splatt30

I've had a virgin card for a few years and frequently take up their promotional offers.
I have had it confirmed, several times and since the allocation of payments changed in September that if you have several promotions at the same rate the payments will go to pay off that which ends first.
I currently have 5, 0% rates running, all of which started and end on different dates. I simply keep a track on the end date and pay each in full before it's end date. Have done this several times and yet to pay any interest

So, OP, if your T&Cs are the same, if you BT and spend on the card both at 0% your payments will go to the spend first as that promotion ends first. If you then pay off all the money for your purchases before the promotion end date (normally the statement date) you should avoid paying interest

twist-and-shout

Splatt you are wrong i am afraid. New payment allocation for mbna is as follows,

In all cases you pay off the highest to lowest rates of interest.
If you have two or more promotional offers at the same rate, they will use your payments to reduce the promotional balance which started first. If they started on the same date then they will pay off the one with the higher standard rate.
This is when it gets tricky and confusing....even for the call centre staff

If you have two rates the same, which started on the same date and have the same standard rate then the payment gets allocated by which offers were created first. This can be found by the last character of the offer code you are taking advantage of.

So for example if you have two offers that are the same rate, start date and standard rate, Offer 1 code is G645-7814 and offer 2 code is G645-7815 your money will be allocated to offer code 1 first as the last digit comes before the last digit of offer two. The above is the same for offer codes that end with letters too.

sheslookinhot

pauljoecoe wrote: »

If you use it for purchases you will lose the 0% for the 16 months.

surely nonsense