New credit card - confused with payment options

molerat

You are complicating things. You need to know how your card applies additional payments and the dates at which those additional payments become critical. Having a DD set up for minimum and making additional payments can lead to underpayment or overpayment of the full balance depending on the card provider. With a sub prime card underpayment of just 1p can lead to a whole lot of pain. Set up a DD for full payment now.

cts_casemod

Not quite Dobbibill... Let me explain:

I own an overseas credit card. Over there I receive my statement and I'm given two weeks since issue to make payment. I can choose any means to pay including, but not limited to, direct debit.

Lets say I set up the direct debit for the minimum payment: That is taken regardless. Then I can choose to make the remainder of the payment using a debit card, an ATM machine or directly with the bank. Things are so much more flexible there that even if I have a full direct debit instruction set up and don't have enough funds they take whatever I have on the bank account and calculate interest according to what I own. The only way to default is if there aren't enough funds to cover the minimum payment.

Here in England is madness. The direct debit comes refused if my bank balance is 1p short of the full payment and a penalty is charged, unless I have an overdraft. On top of that The card issuer issues a penalty for defaulting since the DD was refused and they haven't got any payment. That's the reason I don't want a full direct debit being taken from the account: Too much hassle.

The quote you make for the Vanquis conditions well... It doesn't answer my question at all. Are they forcing me to pay the full amount by direct debit?

Lets suppose this: The statement for the month closes. I check it and it comes with a given value owned (say 200) and how much will be taken by DD (say 50). With this I can calculate the difference and make a debit card payment for the remainder (150). Or am I getting something wrong here? This is the only confusion I have.

Another question: Whats the criteria used by lenders to accept a payment and charge the over-limit fee or to decline the transaction in the first place? Am I charged an over-limit fee if I try to buy something that is above my credit limit but the transaction is refused by the lender?

[Deleted User]

cts_casemod wrote: »

Another question: Whats the criteria used by lenders to accept a payment and charge the over-limit fee or to decline the transaction in the first place? Am I charged an over-limit fee if I try to buy something that is above my credit limit but the transaction is refused by the lender?

To the scond question, no.

To the first, it varies, by both policy and underfloor/offline transactions.

Dobbibill

As explained by zx81, the answers to your questions.

I was saying about a DD simply to avoid paying any interest at all, given the horrendous APR on Vanquis as you initially said it was to use as a credit building exercise.

HTH

boo_star

Dobbibill wrote: »

As explained by zx81, the answers to your questions.

I was saying about a DD simply to avoid paying any interest at all, given the horrendous APR on Vanquis as you initially said it was to use as a credit building exercise.

HTH

This.

Just pay the full amount by DD every month.

Problem solved.

Superscrooge

boo_star wrote: »

This.

Just pay the full amount by DD every month.

Problem solved.

boo_star has summed it up perfectly. It really is that simple.

No need to make minimum payments and then faff about making extra manual payments and trying to calculate exact payments required to avoid paying Vanquis horrendous rates of interest.

Just pay the full balance by DD.

You will then never pay interest and quickly build up your credit history.

agrinnall

And in addition, only buy things with the card that you would otherwise have paid cash for, that way as long as you don't spend the cash on something else too you'll always have enough available to cover the full DD.

redpete

cts_casemod wrote: »

Lets say I set up the direct debit for the minimum payment: That is taken regardless. Then I can choose to make the remainder of the payment using a debit card, an ATM machine or directly with the bank.

Exactly the same here.

Things are so much more flexible there that even if I have a full direct debit instruction set up and don't have enough funds they take whatever I have on the bank account and calculate interest according to what I own.

Never heard of such flexibility here - would require very close information exchange between the bank and the credit card company.

Lets suppose this: The statement for the month closes. I check it and it comes with a given value owned (say 200) and how much will be taken by DD (say 50). With this I can calculate the difference and make a debit card payment for the remainder (150).

Yes, this is how you can manage your payments.

bengal-stripe

cts_casemod wrote: »

Lets suppose this: The statement for the month closes. I check it and it comes with a given value owned (say 200) and how much will be taken by DD (say 50). With this I can calculate the difference and make a debit card payment for the remainder (150). Or am I getting something wrong here? This is the only confusion I have.

Some CC will take the minimum DD regardless of any previous manual payments; other will adjust or even cancel the DD, taking the manual payment into account.

You better make sure you know how your CC operates. Otherwise you might pay too little (and won't qualify for interest-free) or you might pay more than you actually owe.

chuckley

d/d is taken/actions on the due date. so are you planning on manually calculating and paying the remainder before the due date to clear it in full? this is LONGGGGGG!

in short you're over complicating it.

either D/D in full or
faster payment in full

if you insist on minimum payments, the method doesn't even matter.