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Allocation of interest
Mezzomatt
Posts: 1 Newbie
in Credit cards
Hi,
So stupidly, some years ago I took out a Vanquis card (the only one I could get with a poor credit score at the time) and was paying extortionate interest of almost £90 a month on a £2,300 balance! Anyway, I recently managed to get a Barclaycard with a balance transfer rate of 0% for 24 months, saving a whopping c. £2,160 in the interest free period. I'll have almost paid off the balance @ £100 a month repayments, whilst the Vanquis balance would be practically unmoved (absolute scallywags!).
Anyway, I digress. So the 0% rate is for the balance transfer and the purchase rates are 18.9%. I made an online purchase the other day for £350 and also did a transfer a couple of days later, from my bank for the full balance to my Barclaycard account. On inspection of my account online, the payment was taken and the credit happened on the SAME day!
Barclays online state that they allocate payments to the highest rate of interest balance first.
So my question is, as the transactions show the same day, will they allocate the £350 payment against the 0% balance transfer amount, or use this immediately against the higher rate of interest purchase?
To clarify (or put it another way), if I had paid £350 into my account in the statement month, then made a purchase in the same month, does the timing of this payment to my account matter? The last thing I want is for the repayment to be allocated against the 0% balance, then the £350 at 18.9% accrue for the 4 months it will take me to pay this off (at £100 a month repayments). Should I have waited a couple of days before repaying so they would know to allocate it against the purchases?
I hope this question is clear. Sorry for the round the houses questioning.
Matt
So stupidly, some years ago I took out a Vanquis card (the only one I could get with a poor credit score at the time) and was paying extortionate interest of almost £90 a month on a £2,300 balance! Anyway, I recently managed to get a Barclaycard with a balance transfer rate of 0% for 24 months, saving a whopping c. £2,160 in the interest free period. I'll have almost paid off the balance @ £100 a month repayments, whilst the Vanquis balance would be practically unmoved (absolute scallywags!).
Anyway, I digress. So the 0% rate is for the balance transfer and the purchase rates are 18.9%. I made an online purchase the other day for £350 and also did a transfer a couple of days later, from my bank for the full balance to my Barclaycard account. On inspection of my account online, the payment was taken and the credit happened on the SAME day!
Barclays online state that they allocate payments to the highest rate of interest balance first.
So my question is, as the transactions show the same day, will they allocate the £350 payment against the 0% balance transfer amount, or use this immediately against the higher rate of interest purchase?
To clarify (or put it another way), if I had paid £350 into my account in the statement month, then made a purchase in the same month, does the timing of this payment to my account matter? The last thing I want is for the repayment to be allocated against the 0% balance, then the £350 at 18.9% accrue for the 4 months it will take me to pay this off (at £100 a month repayments). Should I have waited a couple of days before repaying so they would know to allocate it against the purchases?
I hope this question is clear. Sorry for the round the houses questioning.
Matt
0
Comments
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in general payments are made against items already on the last statement and not to new purchases this month
so probably your 350 will go against the 0% balance but the subsequent months, any payment will go against your 350 purchase.
best to use different cards for BTs and purchases0
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