Watch Out For This Pitfall With Barclaycard Balance Transfer

dustycat_2

Just fallen foul of an interesting little 'gotcha' from Barclarycard that I thought I would share with everyone.

Barclaycard were offering a 0% BT rate for a few months on my card so I decided to take advantage of it to finance the deposit on a house I am buying.

As I was using my Barclaycard for purchases, I ensure I cleared the balance off the previous statement (which I always did anyway to avoid interest)

I then went to their online system and checked what transactions had been made since the last statement and made an online payment to clear those.

Once the online system was showing my balance as £0.00, I arranged a BT of £5000 (the max they would allow at 0%) double checking that the rate would be 0%

Got my next statement showing that all that was outstanding was the BT amount (plus extortionate fee) however the estimated interest for next month was showing as a large sum. I contacted customer services and they said that with the 0% BTs, the system always showed the interest assuming no payments were made and the balance would be reverted back to a purchase rate. I was assured that no interest would be payable if I made the minimum payment - which I did.

On the subsequent statement however, I find I have been charged the very same large amount of interest.

On contacting Barclaycard they advised that although my payments to clear my purchases had shown on the system as being made on 17th January - they don't actually apply them to the account until the end of the 'billing cycle'. Therefore the payment I had made to clear all the purchases I had made had actually been used to clear the BT first. The purchases had then remaing on the account and accrued interest even though technically they had been in receipt of the money to clear them for well over a month.

Fortunately I managed to get them to credit back the interest after threatening to close the account. However be warned - if you are using the 0% BT facility make sure you don't make the BT until you have had a statement showing a zero balance with next month's interest also as zero.

Also, with Barclaycard having no maximum BT fee, they really aren't a good bet if you want to do a large BT. I've ended up paying more in fees than I would have done borrowing the money for a couple of months at a purchase rate.