New credit card - confused with payment options

cts_casemod

Recently I applied for a Vanquis Card in order to improve my credit score.

I'm a bit confused at how the card works. Apparently the available balance is updated just minutes after the purchase, but the list of movements doesn't show up for quite a few days.

So this month it tells me my minimum payment is £0, despite having spent £200 on the last days. It also doesn't let me make a manual top up.

I have a DD set for the minimum payment. Should I wait for the statement to close and then I have some time to pay up the difference between my spending and the DD? Or should I manually top up just before the statement close date?

Also, from a lender point of view, is it best to keep using the card and top up in between (say a credit limit of 300: Should I top up when close to 300 and continue using or should I get to 200 and leave it until the statement closes and the balance is paid in full?)

Many Thanks

HappyMJ

From a credit score point of view you are better using the card as normal and making one payment every month equal to the amount requested on the statement just a few days before the due date.

If you run out of credit limit during a month then stop using the card until the card is paid off by the direct debit before using it again.

Is this your only credit card? My OH got a Capital One card to improve credit and has lost credit score as she uses £198 of the £200 credit limit every month. The CRA sees it as using a very high percentage of available credit and knocks points off. However, saying all that a credit score figure is quite meaningless.

I would change your DD to pay the statement balance in full each month.

CLAPTON

have two or more CCs
don't use more that half the credit limit on each card
pay in full by DD every month

Dobbibill

cts_casemod wrote: »

Recently I applied for a Vanquis Card in order to improve my credit score.

I'm a bit confused at how the card works. Apparently the available balance is updated just minutes after the purchase, but the list of movements doesn't show up for quite a few days.

The way the card works is that you have a credit limit and to build you credit worthiness up, you need to use it throughout the month and then pay off in full, preferably by DD so that it all goes through even if you are busy. Normally the available credit is updated quite quickly. If you have recently made transactions they won't be updated until a few working days later.

So this month it tells me my minimum payment is £0, despite having spent £200 on the last days. It also doesn't let me make a manual top up.

To make an additional payment or a 'manual top up' as you've called it. These details were on the FAQ's page of Vanquis but it will not show an accurate reflection of using your credit card sensibly as you may have a zero balance so it will look like it's not being used, if you make multiple payments throughout the month.

Via your bank’s telephone or internet banking service, you can make a one off payment or set up a standing order. Simply quote the following details: (1) Our sort code: 60-95-94, (2) Our bank account number: 0000 0001 and (3) Your Vanquis 16 digit card account number. Please allow 3-5 working days for your payment to reach your account via this method.

I have a DD set for the minimum payment. Should I wait for the statement to close and then I have some time to pay up the difference between my spending and the DD? Or should I manually top up just before the statement close date?

Why have you got a DD set up for the minimum payment only? The interest rate is horrendous with Vanquis and you don't want to carry a balance and incur interest on it if you are looking to use it as a credit builder. Manually making random payments is going to go wrong as it will become very confusing to when you've paid, need to pay or can wait to pay. Avoid all the hassle by using it, keeping within the limit and paying off in full each month via DD.

cts_casemod

Simply because I want to make sure that DD payment goes trough and the minimum balance is paid should there be any unexpected issues.

So to clarify, what happens once the statement is closed? Do I get a period of time before the DD where I can make the payment? Or is that amount automatically calculated with interest? If the second I'll definitively look into setting a full DD payment...

So far I am £44 away from reaching my £250 limit. Should I leave it like this? I dont really have the need to use the card, so 100 or 200 I can pay the rest by debit card. What I just want to know is if the amount I spent now (£206 out of £250) is too much, whenever I should try and make a one off payment to alleviate or if i am just fine waiting for the statement to close and aim for 50% next month.

Superscrooge

cts_casemod wrote: »

Simply because I want to make sure that DD payment goes trough and the minimum balance is paid should there be any unexpected issues.

So to clarify, what happens once the statement is closed? Do I get a period of time before the DD where I can make the payment? Or is that amount automatically calculated with interest? If the second I'll definitively look into setting a full DD payment...

So far I am £44 away from reaching my £250 limit. Should I leave it like this? I dont really have the need to use the card, so 100 or 200 I can pay the rest by debit card. What I just want to know is if the amount I spent now (£206 out of £250) is too much, whenever I should try and make a one off payment to alleviate or if i am just fine waiting for the statement to close and aim for 50% next month.

I think you are over-complicating things leading to confusion.

As others have already mentioned Vanquis charge a horrendously high interest rate so just paying off the minimum each month is a very expensive way of building up your credit history.

You can build up your credit history without paying a penny in interest if you simply amend your direct debit to pay the balance IN FULL each month. Then all you have to do is ensure you never exceed your credit limit and that you have sufficient funds in your bank account to pay the direct debit.

Your monthly statement will always tell you how much the direct debit will be and the direct debit isn't taken until at least two weeks after the statement date so you do get time to ensure you have sufficient funds available to cover the direct debit

cts_casemod

Superscrooge wrote: »

I think you are over-complicating things leading to confusion.

As others have already mentioned Vanquis charge a horrendously high interest rate so just paying off the minimum each month is a very expensive way of building up your credit history.

I'm not over-complicating, apparently I'm just not getting my question trough:

I set the DD as the minimum, so I can choose or not to manually pay the remaining balance when the statement is issued, before the payment due date. So what I'm thinking is I have the option to pay whatever suits me manually from the minimum, which is automatically taken to 100% of the debt.

Are you guys saying I cannot do this and have to rely on a 100% DD payment to avoid interest?

Confused :huh:

Dobbibill

You can make manual payments by doing numerous throughout the month, it's easy to get confused as to which statement you are paying.

Paying in advance on your statement is all well and good, but as interest is calculated daily and billed monthly if you miss making a full payment by just one day, you will then be playing catch up and will incur trailing interest, meaning you have to pay you statement off in full for 2 billing periods to avoid interest. A lot of hassle IMHO.

Here's the bit of the T&C's that explains this.

3.9 Interest is charged on transactions at the relevant interest rate(s) (set out in paragraph 3.3) from the date any Purchase, Cash, Cheque and/or Balance Transfer Transaction(s) or any other amount is debited to your Account, until repayment in full. Interest is calculated on the daily outstanding balance on your Account and, except in respect of Purchase Transactions where you have paid off two or more consecutive current statement balances in full each month, is debited to your Account at the end of each statement period. We will add the interest we charge to the outstanding balance on your Account at the date of each statement. This means that you will generally pay interest on interest (see also paragraphs 3.12 and 3.13).

I hope this answers your questions.

You can make manual payments but make sure you get it right.

slink85

cts_casemod wrote: »

I'm not over-complicating, apparently I'm just not getting my question trough:

I set the DD as the minimum, so I can choose or not to manually pay the remaining balance when the statement is issued, before the payment due date. So what I'm thinking is I have the option to pay whatever suits me manually from the minimum, which is automatically taken to 100% of the debt.

Are you guys saying I cannot do this and have to rely on a 100% DD payment to avoid interest?

Confused :huh:

of course you are.

you have a limit of xxx, you can use up to this amount, why the need to 'alleviate' anything or make sure your spending is at 50% of the limit? its complete nonsense, and using the full amount on a card with such a low limit will have absolutely no effect on your creditworthiness.

your fantasy 'credit score' may go down a bit, due to using a high proportion of your available credit, but in reality it'll have no effect on how other lenders will see you.

all that really matters is that you make at least the minimum payment on time to accrue some positive feedback on your credit file.

just use it however much or little you wish, pay on time, stay within your credit limit and you're good to go/

darkidoe

cts_casemod wrote: »

Recently I applied for a Vanquis Card in order to improve my credit score.

Just set direct debit to pay in full every month and spend within your limits. This will improve your score in the long term and reduce any risk of you missing a payment even once which will give a whack to your score and also makes sure you avoid interest! (Why pay interest?)

Simple as that.:beer:

KennethHardy

No need to worry and getting confused, you can use it for buying anything and try not to cross credit limit and pay on time so that you will not suffer with late fee.