Higher balance first?

mjmorris

I've got a 0% balance transfer deal with Barclaycard coming to an end on 01/02/2013. I also have a 6.9% life of balance deal on the same card. I want to move the 0% sum to another card, but I was wondering if B/card will automatically credit the payment to the life of balance deal, or are they flexible about how repayments are made?

Any advice greatly appreciated,

Mike

Paully232000

I have always thought, and I think that I am right, that whenever you pay anything off a credit card it goes to paying the part which attracts the higher interest.
Therefore in your case any payments to your card at present would first pay the parts that attract 6.9% and then the parts which are at 0%.

That has always been the case recently with cards that I have had where some parts are at 0% and others at the standard rate.

Herzlos

The back of the statement should explain the order the balances are paid off in, though it's usually most expensive first or in the order they were acquired.

grumbler

If so, it is worth waiting until 0% ends and the corresponding balance starts attracting the interest rate higher than 6.9%.

Paully232000

"Allocation of payments
If you do not pay the total outstanding balance in full by the payment due date, we'll apply the amount you do pay to reduce the higher interest rate balances before lower interest rate balances. For further details, see your credit card terms and conditions"

above from the barclaycard website, I have a barclaycard too

mjmorris

grumbler wrote: »

If so, it is worth waiting until 0% ends and the corresponding balance starts attracting the interest rate higher than 6.9%.

Yes, I'd come to the same conclusion, but I was trying to avoid the inevitable interest charge, small though it'll probably be.

Mike

sfax

mjmorris wrote: »

Yes, I'd come to the same conclusion, but I was trying to avoid the inevitable interest charge, small though it'll probably be.

Mike

It makes no odds as if you BT now you'll reduce the 6.9% balance and therefore reduce the interest you'll pay between now and Feb

mjmorris

sfax wrote: »

It makes no odds as if you BT now you'll reduce the 6.9% balance and therefore reduce the interest you'll pay between now and Feb

If I balance transfer now, the 6.9% balance will reduce as you say, but the 0% balance will jump to 19.9% in February, and I'll no longer have this particular facility to balance transfer.

sfax

mjmorris wrote: »

If I balance transfer now, the 6.9% balance will reduce as you say, but the 0% balance will jump to 19.9% in February, and I'll no longer have this particular facility to balance transfer.

Ah yes, sorry, was wrongly assuming it reverted to 6.9%