So I should be paying more than the minimum on my credit card?

TheNewGuy_2

Sorry third post in a row!

But I've now read several times on this forum that you should be paying more than the minimum requirement on your credit card. Why is this and how much more should you be spending?

[Deleted User]

Paying minimum makes you look as if you can't effectively service your debt.

You should be paying as much as you can. Preferably clearing in full each month.

The exception is if you are on a 0% offer.

Deru

If you just pay the minimum, you'll pay more interest and the debt will drag on.

Why is this and how much more should you be spending?

Spend only what you can afford to pay back without getting yourself into massive debt?

TheNewGuy_2

Oh sorry! I should have said it's a 0% offer for over a year. I don't get charged any interest and my savings more than cover my debt. I am just trying to stooze.

20aday

TheNewGuy wrote: »

Oh sorry! I should have said it's a 0% offer for over a year. I don't get charged any interest and my savings more than cover my debt. I am just trying to stooze.

I'm currently doing a "small stooze" and the minimum payment on the card (in my case) is £25.00.

When it comes to the due date I've made the minimum payment plus an additional £1.

It's only when you're being charged interest on a daily basis should you aim to clear your card in full each month.

TheNewGuy_2

We might have the same card, Nationwide Select?
How do you think the extra £1 helps? Does it shoe them you're trying to pay more or something?

TheNewGuy_2

We might have the same card, Nationwide Select?
How do you think the extra £1 helps? Does it shoe them you're trying to pay more or something?

mrs_T

I have been stoozing for many years paying the minimum by DD and never had a problem getting new cards to balance transfer to. Problem now is I'm not working and have a stooze ending in Feb which I'm loathe to pay off rather than balance transfer.

Candyapple

I've had pretty much the same experience as Mrs T above and there are numerous threads from other posters on the credit card forum which attest to this also.

Basically one of the credit reference agencies (the other 2 might have caught on and report the same, can't say for sure) when you viewed your repayment history used to have a section that stated 'minimum payment Y/N'.

e.g.

CARD PROVIDER NAME
Limit: £3000
Amount owed: £1000
Promotional offer: Y
Minimum repayment: Y
Last updated: 31/10/2015
Status: 0000000

So some people might prefer to make an additional manual payment of £1 to get rid of the 'Y' under that code. In my experience I have found it makes zero difference.

The more important factors are being on the ER, good stable employment with high income, good solid history of repayments and long held accounts also with some long held closed accounts which shows a wider long term history of repayments rather than paying £1 extra to avoid a minimum payment marker.

JimmyTheWig

The important thing is to pay at least the minimum each month on time. If you miss a payment then they will cancel your 0% rate.
I'd rather set up a direct debit for the minimum amount and get the credit file marker to say I paid the minimum than pay a pound extra manually and risk missing a payment.

Best of all worlds, I guess, would be a direct debit for minimum plus £1. I don't believe any credit card companies have this option.

Like many others, I Stooz and pay the minimum and haven't hit problems.

CalumHeath

I've been taking advantage of 0% balance transfer offers for years. I've always paid only the minimum amount.

When I discovered MSE, paying the minimum amount plus £1 was a new one on me, though I did understand the logic of it: if you pay the minimum amount this is recorded on your credit history and may lead lenders to assume (rightly or wrongly) that you are struggling to repay.

I notice on Noddle they report whether a balance is on a promotional rate or not - alongside whether the payment you made was the minimum required. Therefore, one would assume that when a lender sees this information, they would see why you are paying the minimum amount.

So in summary, I don't think it matters that much at all.