Getting a cash advance from a Barclaycard. Bad idea?

nobblyned

Unless negative payment hierachy doesn't apply to this particular card, it does to most, then any payments you make to the balance after the cash withdrawal will be applied to the cheaper balance first and you will not be able to chip away at your cash withdrawal balance until you have cleared the rest. This could cost you a fair amount in interest.

nobblyned

nobblyned wrote: »

Unless negative payment hierachy doesn't apply to this particular card, it does to most, then any payments you make to the balance after the cash withdrawal will be applied to the cheaper balance first and you will not be able to chip away at your cash withdrawal balance until you have cleared the rest. This could cost you a fair amount in interest.

My apologies, understand that this doesn't apply any more, rules changed since Jan

notafan

nobblyned wrote: »

Unless negative payment hierachy doesn't apply to this particular card, it does to most, then any payments you make to the balance after the cash withdrawal will be applied to the cheaper balance first and you will not be able to chip away at your cash withdrawal balance until you have cleared the rest. This could cost you a fair amount in interest.

Hasn't this rule just been changed for all cards? (not disagreeing just asking as i haven't had a good look through these new rules)


you was too quick with your second reply ;-)

chattychappy

The new rules should now be applied to all cards. But some cards will apply payments to statemented transactions before unstatemented transactions, so the hiearchy is not always strictly applied. Since interest is calculated daily, that goes against the spirit of things IMHO, but there you have it!

ensignia

I'm confused! If I pay off the £1500 too quickly it could potentially pay off my regular balance, but leave my cash balance as £1500? Is that right? Whenever I've phoned up Barclaycard, although they're polite and informative, they've not been able to answer any specific questions.

I know the new rules have come in whereby any payments are applied to higher interest balances, yet the CC companies seem to keep quiet about these little 'foibles' with their T&C's.

Also if I were to go ahead and get the cash what would I need to take with me to the bank? I'm already a Barclays customer.

chattychappy

ensignia wrote: »

I'm confused! If I pay off the £1500 too quickly it could potentially pay off my regular balance, but leave my cash balance as £1500?

If the "statemented balance" issue applies, then this is where you could fall foul:

01JAN Purchases £2000 holiday
05JAN Statement - shows £2000 holiday - payment due by 20JAN
10JAN Cash advance - £1500
13JAN Pay £1500
20JAN Pay £2000
5FEB Statement - will show zero balance, except for cash interest

Now you might assume you would only pay 3 days interest. In fact the payment on 13JAN will be applied to the £2000 holiday showing on the statement. When you pay £2000 on 20JAN, this will be applied to the remaining £500 of the holiday and then the cash advance.

So - 10 days interest instead of 3.

I'm not sure whether Barclaycard operates like this...

ensignia

My cash credit limit according to my statement is only £2100, but when I spoke to BC on the phone the woman said I was able to take out as much as my available credit limit would allow. barclaycard.co.uk also says this. Which is correct? The one on my paper statement or my online account?

Also, how much interest would be added in 3 weeks to a £2500 cash advance with APR of 27.9%? As long as it's well below £300 (withdrawal fee+interest) I'll be happy. My maths is awful by the way

YorkshireBoy

ensignia wrote: »

Also, how much interest would be added in 3 weeks to a £2500 cash advance with APR of 27.9%? As long as it's well below £300 (withdrawal fee+interest) I'll be happy. My maths is awful by the way

Well the 'A' in APR stands for annual, so very roughly the interest will be...

£2,500 x 27.9% / 52 x 3 = £40.24

chattychappy

Including the fee, I make the total cost £99.63 (based on working back to a monthly interest rate).

£99.63 is quite alot on £2500 for 3 weeks. The fee (which I assume to be 2.5%) has a disproportionate effect. The effective APR (ie including the fee) is about 97%.

But under £300!

knightstyle

My son needed cash in a hurry for about six of months so withdrew cash from another credit card over the counter at a bank, fee 3%. Then immediately, balance transfer from Barclaycard fee 3% this is now 0% till Oct 2011. So total cost £60 per £1,000. He will have paid it off by Oct. but if not could transfer it to another free credit card.