Question about credit cards

xmrbrightside89

Hey guys,

I was wondering, once you get the statement each month, and you pay off the balance in full, can you start spending again with your credit card? or you have to wait like 5 days until the payment clears?

also, if you pay the minimum amount by direct debit, but then after a week you pay off the balance in full, do you still get to pay the interest? for a week or a whole month?

and if you have 500£ limit, it's impossible to spend 501£ right? the transaction would just be rejected right?

I read on some posts that it's better to avoid spending all or almost all your credit limit, and stay below 50%... why is that? even if you pay off in full each month?

I'm still quite confused on how credit cards really work

Tixy

You need to wait until the payment clears.

As long as the balancing payment is before the due date on the statement you won't pay any interest.

Its not impossible to go over the limit, cards frequently willl authorise transactions and then charge you for going over the limit. Don't rely on them, instead ensure you know how much you owe and how much you can spend before hitting the limit.

Spending right up to your credit limit can be treated as a negative point if you are applying for new cards/other credit products.

worriedinspain

Tixy says:

"As long as the balancing payment is before the due date on the statement you won't pay any interest."

Be careful, as all credit cards are not quite the same. I have just found out that my Lloyds TSB Advance Mastercard charges me interest on my outstanding balance even though I have been paying it off each month in full. (I think there was a six month no interest period).

lisyloo

Be careful, as all credit cards are not quite the same.

Yes correct.
For that particular card there are NO interest free days (apart from the promotion 6 month period).
That's unusual, but it's a good point - it's important to read the terms.

CLAPTON

worriedinspain wrote: »

Tixy says:

"As long as the balancing payment is before the due date on the statement you won't pay any interest."

Be careful, as all credit cards are not quite the same. I have just found out that my Lloyds TSB Advance Mastercard charges me interest on my outstanding balance even though I have been paying it off each month in full. (I think there was a six month no interest period).

madness
if true then get a new credit card asap

CLAPTON

xmrbrightside89 wrote: »

Hey guys,

I was wondering, once you get the statement each month, and you pay off the balance in full, can you start spending again with your credit card? or you have to wait like 5 days until the payment clears?

also, if you pay the minimum amount by direct debit, but then after a week you pay off the balance in full, do you still get to pay the interest? for a week or a whole month?

and if you have 500£ limit, it's impossible to spend 501£ right? the transaction would just be rejected right?

I read on some posts that it's better to avoid spending all or almost all your credit limit, and stay below 50%... why is that? even if you pay off in full each month?

I'm still quite confused on how credit cards really work

you can continue to spend on the credit card before the balance is paid off as long as you do not exceed your credit limit.


as long as you pay the full balance by the due date then you do not pay any interest (even if you made several payments)


as already said you can sometimes exceed your credit limit which is very bad news as you will be charged a fee and possibily have your credit reord marked.

yes if better to keep well below your credit limit as otherwise you look as if you can't manage money well and of course it means you wn't go over your limit by accident.

thenudeone

CLAPTON wrote: »

as long as you pay the full balance by the due date then you do not pay any interest (even if you made several payments)

However - you need to pay off two consecutive months in full before the interest stops being charged.