Settling a statement before it's due

datimms

Hi,

Is it generally possible to settle a credit card (including calculating all interest due) before you've received a statement?

For example, if I use a Top Card abroad and use it to withdraw cash, can I call them when I get home and pay it all off straight away?

In the past, I've waited for the direct debit, but the interest payments add up and can be payable for several months after the holiday (e.g. paying interest on the interest). This makes it difficult to know how much was really spent until it's paid off. I would prefer to just settle it in one go in future.

Many thanks
Dave

[Deleted User]

You can make an immediate payment. But you need to understsand the allocation of payments - ie whether they will allocate it to statemented transactions first.

YorkshireBoy

Yes you can pay it upon your return, but you may need to clear the entire balance (including any purchases made) depending on the specific card. Could be a problem if you have a full payment DD set up as you may pay twice!


On your "several months" point, the most will be two months (the second of which would be a very small residual amount).

zagfles

Deleted_User wrote: »

You can make an immediate payment. But you need to understsand the allocation of payments - ie whether they will allocate it to statemented transactions first.

They will almost certainly allocate to statemented transactions first, even if a full DD is waiting to be taken.

mvarrier

I do this all the time with my Halifax clarity card. In fact I clear the balance in advance. Then I credit it with 250 quid the morning I fly. I keep a track of spending then top it up with more money as needed. This way I pay zero interest. All this can be done via your phone using the hotels wifi

thebritishbloke

mvarrier wrote: »

I do this all the time with my Halifax clarity card. In fact I clear the balance in advance. Then I credit it with 250 quid the morning I fly. I keep a track of spending then top it up with more money as needed. This way I pay zero interest. All this can be done via your phone using the hotels wifi

Careful doing this, it's against most credit cards T&C's and they could cancel your account for putting your account in credit. You won't pay any interest if you pay off your statement in full every month.

datimms

Thanks for the responses. It sounds like this is possible then.

I won't have to worry about allocation of payments as I rarely use the card for other transactions and always pay my card off in full regardless. To be sure, I could always pay off any existing balance before I leave.

In terms of the methodology, I was thinking that I could just call them up afterwards and tell them I want to "zero my account" or something similar.

Pre-loading my account is one idea but I am reluctant to do so, for the T&C reasons mentioned.

datimms

Thanks for highlighting the T&C issue.

thebritishbloke wrote: »

... You won't pay any interest if you pay off your statement in full every month.

This is partially true. Purchases by card are interest free, however cash withdrawals attract interest from day 1. Even the best credit cards (eg Halifax Clarity) allow fee-free (but not interest free) cash withdrawals.

CLAPTON

datimms wrote: »

Thanks for the responses. It sounds like this is possible then.

I won't have to worry about allocation of payments as I rarely use the card for other transactions and always pay my card off in full regardless. To be sure, I could always pay off any existing balance before I leave.

In terms of the methodology, I was thinking that I could just call them up afterwards and tell them I want to "zero my account" or something similar.

Pre-loading my account is one idea but I am reluctant to do so, for the T&C reasons mentioned.

paying off cash advances as asap will reduce the interest charged but I doubt you will be able to ask them to 'zero your account' as the interest will not have been calculated until the statement is prepared (and so the customer services person won't know what it is)

best to pay what you have borrowed plus a little bit more .


the reason you pay interest two months running isn't really because you are paying interest on interest
it's because the first statement will show the interest from the day you withdrew the cash to the STATEMENT date

and the second statement will show the interest between the first statement date and the day you actually paid the bill: there will be a little interest on interest but it will be very small.