Credit card repayment

ella2ethan1

Hiya,

I have 2 credit cards and pay the minimum payment each month, the last couple of months I have noticed that instead of paying money off the card with my payment, the interest is more than the payment so I am adding to the balance instead of taking it off.

Is this allowed? I shall be paying more off now to make sure it comes down but did think that this wouldn't be allowed.

Thanks for any advice your can give.

Sarah x

Tixy

On some older accounts it is possible yes.
On older accounts the minimum payment is generally a % of the balance and if the interest rate is higher than that % then the balance could increase.

On newer cards the minimum has to be at least 1% of the balance plus interest, so assuming no new spending and no charges the balance would decrease each month.

bankscausepain

This could be possible as Tixy explains. Please let this be a warning to you, that you need to address these debts ASAP.
Paying off just the minimum payment is always dangerous, but even more so in your situation because the debt is increasing each month.

Try a balance transfer to give you an extra 12/24 months to pay off as much of the real debt as possible.

thenudeone

Don't complain that the bank isn't taking enough to cover the interest.

The statement shows the estimated interest and the minimum payment.

If you want to pay more, just do it yourself.