Pitfalls of zero rate interest credit cards

basotho

Somebody I know well had a zero percent credit card with Halifax, just over £ 7 000, the bill came to £ 74. The person sent £ 70. This morning they received a bill with £ 12 added and which stated that the account was now in arrears. They phoned Halifax and the operator cheerfully said that they would waive the £12 charge but now they would need to pay interest of over £ 90 per month for the foreseeable future.

This person made a slight mistake - severe punishment. Banker makes mistake - bonus.

Joe_Bloggs

It makes sense to have a direct debit set up for the minimum payment.
To a large extent those who pay interest subsidise those who don't.
J_B.

eschaton

basotho wrote: »

Somebody I know well had a zero percent credit card with Halifax, just over £ 7 000, the bill came to £ 74. The person sent £ 70. This morning they received a bill with £ 12 added and which stated that the account was now in arrears. They phoned Halifax and the operator cheerfully said that they would waive the £12 charge but now they would need to pay interest of over £ 90 per month for the foreseeable future.

This person made a slight mistake - severe punishment. Banker makes mistake - bonus.

When it comes to finance you can't make mistakes. It isn't really hard to read a statement and pay what is due.

chattychappy

basotho wrote: »

Banker makes mistake - bonus.

Yep, it was the banker's fault.

And there was me thinking it was Col Mustard with the lead piping.

basotho

The point I was trying to make was that the severe punishment did not fit the crime. I was not looking for sympathy. This is the same as instead of being fined £ 20 for minor parking offence - you have to pay £ 1 000.

thegoodman

If minimum payment is £74 you will need to pay £74 even £73.99 is not enough. And also in most cases you loss your 0% period.
That's how it work.

jonesMUFCforever

If you walk into Tesco and your shopping comes to £74 do you think that they would accept £70?

Not a cat's in hell chance - same thing with the credit card - they give you a free (almost if you ignore the fee) loan providing you pay the minimum (not the minimum less £4).

I really don't know why you posted to be honest.

basotho

This person who did this made a simple mistake. There is absolutely no way they could gain from this - That much is obvious. It is also obvious that if you are charged £ 70 in Tesco, the person behind the counter will not try charge you interest on it but will simply say. "You seem to have made a wee mistake there, you are £ 4 short, would you pay the difference, please?"

Typhoon2000

Remember banks are there to make from money from you, one way or another. Thats the only reason they gave you the credit card. The reason they give 0% offers is so they can make money from you somewhere down the line. Thats just the way it is, thats the risk of credit cards. If you have your wits about you, you can come out on top - if you dont the bank wins. Banks win more than they lose - otherwise they wouldn't be handing out credit cards and 0% offers.
If you want to play safe, its best to stick with a debit cards.

thegoodman

basotho wrote: »

This person who did this made a simple mistake. There is absolutely no way they could gain from this - That much is obvious. It is also obvious that if you are charged £ 70 in Tesco, the person behind the counter will not try charge you interest on it but will simply say. "You seem to have made a wee mistake there, you are £ 4 short, would you pay the difference, please?"

You are wrong with this. The reason Tesco will say that because you have not got the goods yet, not until full payment is received. If you take out the insurance policy with them and not pay for the month what do you think will happen?
With the credit card you have already got the money and you will pay back as per terms.

Never my fault: I have paid less than minimum the card company charge me, it's fault of the card compan. I should not have been charged for not paying minimum.

cooltt

OP

Ignore some of the people on here they're clearly perfect and have never made a mistake in their lives.

0% deals are a game for the lenders you either don't pay off the balance in time and then you start paying interest or you break their T&C's and your offer is withdrawn and they have you bang to rights.

It's !!!! but that's the way they all work i'm afraid, however i had a run in with Halifax about 6 months ago for nearly the same thing and i wrote them a nice letter pointing out that i thought it was a little excessive withdrawing my 0% offer because i was a day late paying a payment (i'd stupidly forgot to set up a DD) and to my amazement they called me a few days later apologised and re-instated it.

So i suggest your friend does the same they can only say no.