Paid of card in full and then charged £12!

mustang1

So annoyed. I paid off the last of my 0% credit card bill in full earlier this month. I cancelled my direct debit given my balance was £0 and then got charged £12 for a failed direct debit payment, even though the DD would have put my card in credit as there was no payment due.

Virgin have said I needed to tell them before cancelling the DD, even though i had paid off the balance as it was a breach of the DD agreement. They've agreed to give me the £12 back as goodwill but it's just annoying that I might have this on my credit report after trying so hard to get my debt to £0.

A salutary lesson not to be so good at paying things off next time!

shortcrust

mustang1 wrote: »

So annoyed. I paid off the last of my 0% credit card bill in full earlier this month. I cancelled my direct debit given my balance was £0 and then got charged £12 for a failed direct debit payment, even though the DD would have put my card in credit as there was no payment due.

Virgin have said I needed to tell them before cancelling the DD, even though i had paid off the balance as it was a breach of the DD agreement. They've agreed to give me the £12 back as goodwill but it's just annoying that I might have this on my credit report after trying so hard to get my debt to £0.

A salutary lesson not to be so good at paying things off next time!

A lot of credit card companies will still take scheduled DD payments even if you clear your balance. If you set up a regular fixed amount payment with them I suppose it makes sense that that would try to take than amount until you tell them otherwise, regardless of the balance. Either way, it seems sensible to give them a call before cancelling a DD.

I think the lesson from this should actually be to be better at paying things off!;)

chattychappy

The problem with DDs is they are promoted as making your life easier to manage, but there are a number of pitfalls you have to be aware of - and typically you only find out when it's too late.

In the days when the alternative was sending a cheque in the post, I could see their attraction. But in these days of online banking and faster payments, they do seem rather primitive.

Glad you got the rather disproportionate £12 penalty refunded.

iAMaLONDONER

mustang1 wrote: »

So annoyed. I paid off the last of my 0% credit card bill in full earlier this month. I cancelled my direct debit given my balance was £0 and then got charged £12 for a failed direct debit payment, even though the DD would have put my card in credit as there was no payment due.

Virgin have said I needed to tell them before cancelling the DD, even though i had paid off the balance as it was a breach of the DD agreement. They've agreed to give me the £12 back as goodwill but it's just annoying that I might have this on my credit report after trying so hard to get my debt to £0.

A salutary lesson not to be so good at paying things off next time!

Thanks for the warning!

I think the lesson is to avoid making a DD -unless you need it to switch to a bank account i.e Halifax Reward

Voyager2002

mustang1 wrote: »

They've agreed to give me the £12 back as goodwill but it's just annoying that I might have this on my credit report after trying so hard to get my debt to £0.

No: nothing to go on your credit record: you did after all make the required payment, although not by the means that they were expecting.

YorkshireBoy

iAMaLONDONER wrote: »

I think the lesson is to avoid making a DD

The "lesson" to be learned here is to read what they send you!

The 'Important: Confirmation of direct debit instruction' letter they send you tells you that they'll always collect the statemented DD amount unless you contact them at least 5 (maybe 7?) working days before the payment due date.

Because they know a lot of people won't bother reading this letter, they also put a notice saying the same on your monthly statement...so that'll be circa 24 times they tell you what's going to happen during the 0% intro period.

Now if people don't read the statement (at one of the circa 24 opportunities they have)...well, what else are they supposed to do?

chattychappy

Yep, YB, can't argue with that. But it is a bit counter-intuitive when people have already cleared the balance only to find that some days later the DD is taken anyway - putting the CC into credit (which shouldn't really happen). And having to give 5 (?7) days notice to stop the thing - that sounds like the whole thing is run on typewriters...

So yes, people are told how the system works. But it isn't really what people want these days.

How about a system whereby if they haven't received payment by the due date, then the minimum is taken instantly by DD? In this world of Faster Payments, that should be possible. But no doubt somebody (perhaps even MSE) would moan that DD users are no longer getting advanced notice of the amount to be taken (though I would have thought a sentence on the statement "we will take the minimum by DD on the due by date if we haven't received your payment" would be enough. Really that's probably what most people want from DD - a system that cuts in should they forget.

iAMaLONDONER

YorkshireBoy wrote: »

The "lesson" to be learned here is to read what they send you!

The 'Important: Confirmation of direct debit instruction' letter they send you tells you that they'll always collect the statemented DD amount unless you contact them at least 5 (maybe 7?) working days before the payment due date.

Because they know a lot of people won't bother reading this letter, they also put a notice saying the same on your monthly statement...so that'll be circa 24 times they tell you what's going to happen during the 0% intro period.

Now if people don't read the statement (at one of the circa 24 opportunities they have)...well, what else are they supposed to do?

Oh well I always have paid manually via Faster payments!

Cell

chattychappy wrote: »

Yep, YB, can't argue with that. But it is a bit counter-intuitive when people have already cleared the balance only to find that some days later the DD is taken anyway - putting the CC into credit (which shouldn't really happen). And having to give 5 (?7) days notice to stop the thing - that sounds like the whole thing is run on typewriters...

So yes, people are told how the system works. But it isn't really what people want these days.

How about a system whereby if they haven't received payment by the due date, then the minimum is taken instantly by DD? In this world of Faster Payments, that should be possible. But no doubt somebody (perhaps even MSE) would moan that DD users are no longer getting advanced notice of the amount to be taken (though I would have thought a sentence on the statement "we will take the minimum by DD on the due by date if we haven't received your payment" would be enough. Really that's probably what most people want from DD - a system that cuts in should they forget.

Because direct debits are initiated a few days before they're actually taken?

The DD system is totally unrelated to Faster Payments. It's linked to BACS instead, meaning there is a lag time of at least three days.

http://www.payyourway.org.uk/payments-explained/Direct-Debit/

chattychappy

Cell wrote: »

Because direct debits are initiated a few days before they're actually taken?

The DD system is totally unrelated to Faster Payments. It's linked to BACS instead, meaning there is a lag time of at least three days.

http://www.payyourway.org.uk/payments-explained/Direct-Debit/

I know that. And that's the problem!