MBNA (AA) credit card sleight of hand

Typhoon2000

The only reason to pay as late as possible and maximise your interest free period is if you are paying off the balance in full. If you don't, and only pay partially, then you don't have any interest period at all and they charge you interest from when you made the purchase to when you made the partial payment.

MonkeyMad

Wasting your breath I'm afraid...

prowla

Typhoon2000 wrote: »

The only reason to pay as late as possible and maximise your interest free period is if you are paying off the balance in full. If you don't, and only pay partially, then you don't have any interest period at all and they charge you interest from when you made the purchase to when you made the partial payment.

Ah, so paying early avoids the interest on the minimum amount for the number of days from statement being issued to the due by date.

Typhoon2000

Er no, paying early reduces interest on the amount you pay. If you are carrying a balance and make a payment (any amount, minimum or otherwise) credited on the day the statement is produced you pay 0 days interest on the amount you paid back and around 28 days interest on the remaining balance when the subsequent statement is produced. If you leave your payment to the last possible due date you pay 28 days interest on the whole amount (what ever you paid back and the remaining balance) on your next statement.
So if you are carrying a balance, and you have the money for the paymement (minimum or greater) pay it as early as possible after the statement date to minimise interest that month. Thats one way how credit card companies get a little extra when you set up and rely solely on a DD to make the minimum payment - they always set up the DD to go out close to the due date, not as soon as the bill is produced.

chattychappy

Typhoon2000 wrote: »

Thats one way how credit card companies get a little extra when you set up and rely solely on a DD to make the minimum payment - they always set up the DD to go out close to the due date, not as soon as the bill is produced.

:T:T:T

Yep. Nobody who is carrying a balance (except at 0%) should be on a DD. You should be paying as much as you can as soon as you can (making multiple payments if necessary) in order to minimise interest. The exception to this rule is that you shouldn't pay so much in one statement cycle that you won't be able to meet the minimum in the next. (Unlikely to be a problem for people on a regular income.)

Eonel

Let's hope the OP does not get any trailing interest in the statement after clearing the balance.

That would be the longest thread ever.

The_AA_Company_Representative

We would certainly be happy to clarify the circumstances here, please send an email to [EMAIL="chat@theaa.com"]chat@theaa.com[/EMAIL] entitled Reference 9074. Thank you, The AA.