Balance transfer mess up

Yamor

Hi,

Slightly complicated question here:

I recently took out an HSBC credit card, which gave me 32 months 0% on balance transfers and 3 months 0% on purchases.

Now, I KNOW the advice is not to spend on the credit card at all, however, I did spend, assuming that if I'd be careful and pay off the purchases each month, I'd be safe.

Now, that is true to an extent, but to my horror I've realised that because my purchases were also attracting 0% interest, my payments went to pay off the balance transfer first, even though the period of 0% for purchases was far shorter.

My question is, how do I now go about ensuring that I do not pay any interest at all?

The end of my 0% promotional rate on purchases is given by the bank as 23Feb16.
I can't pay off my purchases earlier then that, because the money will be used to pay off my balance transfer.
If I pay off on the 23rd will I be safe? Or do I need to pay it off on the 24th? If I pay it off on the 24th will I end up paying 1 day's worth of interest?

[Deleted User]

Yamor wrote: »

Hi,
I've realised that because my purchases were also attracting 0% interest, my payments went to pay off the balance transfer first, even though the period of 0% for purchases was far shorter.

Is that definitely correct? Most cards apply payments to the promo which ends first, if both at the same rate. However, their t&cs seem to be silent on the allocation.

Could it be that you made a payment before the purchases appeared on your statement?

debtdawg

HSBC will always clear off the debt from payments that will earn them the least amount of interest. You shouldn't have used the card for balance transfers and purchases - until you clear the balance transfer you will be paying interest on the purchases.

[Deleted User]

debtdawg wrote: »

HSBC will always clear off the debt from payments that will earn them the least amount of interest.

That's not true. All lenders have to put payments to the balance with the highest interest rate first.

grumbler

debtdawg wrote: »

HSBC will always clear off the debt from payments that will earn them the least amount of interest.

Really?

http://www.hsbc.co.uk/1/2/credit-cards

Check the Summary Box of any card for "Allocation of payments"

... - until you clear the balance transfer you will be paying interest on the purchases.

BS

Yamor

Deleted_User wrote: »

Is that definitely correct? Most cards apply payments to the promo which ends first, if both at the same rate. However, their t&cs seem to be silent on the allocation.

Could it be that you made a payment before the purchases appeared on your statement?

Hi,

Thanks for your help.
The purchases had appeared on my statement before I paid it off.
I had also thought like you, so I called them up to complain, and the guy I spoke to said that if they're both 0% they pay off balance transfers first even if the purchases promo does end first.

debtdawg

Apologies OP, I stand corrected. Based my reply on experiences of old!

Yamor

So. Anyone have an idea of how I should proceed to pay off my purchases without incurring any interest?
Will a payment on the 23rd be alright?

[Deleted User]

I would pay on 24th. How much will a day's interest cost you?

JimmyTheWig

Yamor wrote: »

the guy I spoke to said that if they're both 0% they pay off purchases first even if that promo does first.

Is this a typo?
If not, that's exactly what you want - to pay off purchases first...

Yamor

JimmyTheWig wrote: »

Is this a typo?
If not, that's exactly what you want - to pay off purchases first...

yes, it's a typo, sorry! I've corrected it.