Paying Credit Card by Standing Order or Direct Debit?

moconnor

Hey,

Im writing to understand if its best to pay a credit card off by standing order or direct debit.

I get billed every 15th of the month where an amount (including interest and min payment) is taken from my current account.

I want to be able to pay 60 a month onto the card to eventually pay it off, however I'm worried if I cancel the direct debit I'm going to screw it all up!

Its at 1100 credit at the moment with a 2000 credit limit so I'm getting there slowly, I just want to be able to get it sorted with an amount that I dont have to think about rather than the amount changing every month!

Thanks for your advice in advance

dresdendave

Your statement and due date can move around month by month. A standing order on a fixed date could end up missing a due date and you being hit with charges. I would suggest setting up DD for minimum payment and then manually overpaying as much as can.

grumbler

dresdendave wrote: »

Your statement and due date can move around month by month.

Very little.

A standing order on a fixed date could end up missing a due date and you being hit with charges.

I think a SO 2-3 days after the normal due date should be fine. Even if it accidentally happens to be before the due date because of the variation and affects the DD , it's not a big deal. However, at many providers extra payments don't affect the DD.

Also, some CC providers allow setting a DD for a fixed amount.

YorkshireBoy

There are pros and cons for both methods. However, if your card provider is one of those who don't offer a fixed payment (as well as minimum or full) DD, then if you want to make only one payment each month of the same amount you're stuck with SO.


As above, this may catch you out if the statement date changes (weekends/Bank Holidays/system glitches/etc), or if they cut the 'up to xx days' figure by notice of variation.


If you're the forgetful kind, then DD all the way with additional payments as and when as suggested by dresdendave. However, if you want to be in 100% control of when the payment(s) leaves your account, then consider paying via immediate FP or set up a future dated FP when your statement arrives.

YorkshireBoy

grumbler wrote: »

Very little.

That "very little" catches an awful lot of people out, if the regular posts on here are anything to go by when they report losing the 0% promotional rate!

moconnor

Thanks for your reply folks!

I'm thinking of setting it up on the first of every month that way avoiding the issue of missing a due date. If I pay it before the due date surely that should cover it? Again total novice with the statement repayments but from experience with invoices and statements in general, paying it early is advisable!

SuperHan

grumbler wrote: »

Very little.
I think a SO 2-3 days after the normal due date should be fine. Even if it accidentally happens to be before the due date because of the variation and affects the DD , it's not a big deal. However, at many providers extra payments don't affect the DD.

Also, some CC providers allow setting a DD for a fixed amount.

My due dates vary from the 11th to the 14th, and I've only checked the past 6 months. It creeps later each month it seems. So If I was setting my SO for two to three days after the 'normal' due date of the 11th, wouldn't it be taking additional payment for the already generated statement, rather than contributing towards the minimum for the following month?


I stand by a minimum DD and then make additional payments. That way you can't go wrong.

redpete

moconnor wrote: »

I'm thinking of setting it up on the first of every month that way avoiding the issue of missing a due date. If I pay it before the due date surely that should cover it? Again total novice with the statement repayments but from experience with invoices and statements in general, paying it early is advisable!

You need to be certain that the money is paid between the date the statement is produced and the due date for payment from that statement.

So, if the statement is produced on the 2nd and you've paid on the 1st then as far as the CC company is concerned you made no payment for that month and will incur charges.

bengal-stripe

moconnor wrote: »

I'm thinking of setting it up on the first of every month that way avoiding the issue of missing a due date. If I pay it before the due date surely that should cover it?

Some Credit Cards will adjust (or cancel) the DD if an additional payment is received at least 5 days before the due date. Others will take the DD regardless. Check which way your card operates.

You can always leave the DD in place and time the additional payment that the two payments do not clash. (You can set-up a Faster Payment days or weeks in advance to leave your account at a specified date.)

moconnor

SuperHan wrote: »

wouldn't it be taking additional payment for the already generated statement, rather than contributing towards the minimum for the following month?

Yep - thats what I was wondering, so DD with top up instead. Can that top up be a SO? £20 a month SO and the DD as whatever each month?

I just checked and payment is due between 13-16 of the month and the statement is generated on the 20th of each month. So I take it I pay before the 20th to cover that months statement?

lynz68

There have been quite a few post on here where people have messed up using S/O and have missed payments and had charges because of this usually due to the payment due dates moving.

For me the easiest way is to pay the minimum by D/D and make an online faster payment for the rest.