Problem with credit card interest and 0% car insurance

monstereyebrows

Can someone help I have egg cc I just use it for the interest free car insurance scheme they do. However I purchased washing machine and paid the entire balance of the machine off before payment date.

Now egg have charged me interest because they say that the payment made for washing machine is paid to the lowest interest rate in this case the 0% for the car insurance.

How can be so? ie if you purchase any item at the same price or near it you would never get interest free insurance. The only way is to put the insurance (0% for 12 months) on the card when the balance owing is zero and never use the card until 0% insurance is finish 12 months later.

Your comments would be appreciated.

CLAPTON

it is usual for payments to be allocated to the lowest interest rate balance first then the next etc.
so once you have some balance with 0% never then spend any money on the card until the balance is clear

you do get some benefit from the 0% rate still but a lot less than you would otherwise expect

tom188

This is the same with any credit card company - they pay of the cheapest debt first. It is clearly stated in the terms and conditions.

You paid the equivalent amount as the washing machine cost off the car insurance debt and the washing machine debt will collect interest until you have cleared the card.

This is why people have multiple cards for different purposes - they would never spend on the egg card until the 0% debt is cleared.

Phoenix79_2

Nationwide are different I believe? They pay off the highest interest debt first.