Halifax and upping the minimum monthly payment

PurpleHat

Hi folks,

Just wondering if any other Halifax credit card customers have been getting letters stating that the minimum monthly payment is being changed? The calculation will now be "1% of the balance + interest." On a debt of £4500, this means minimum payments going from £90 to £130, in the case of my relative, who is on a low income as it is, and is unlikely to get a cheap balance transfer, as she is only able to pay the minimum or just over as it is.

Do the same rules that apply to refusing to take an increase in interest, closing and continuing to pay off at current level apply in this case? As it's not clear from the letter.

KRB2725

What were they charging before? I thought 1% + interest and any charges was the minimum payment that was allowed anyway?

glentoran99

If she can only just afford minimum payments then she should be looking at other options to clear the debt

grumbler

PurpleHat wrote: »

Just wondering if any other Halifax credit card customers have been getting letters stating that the minimum monthly payment is being changed? The calculation will now be "1% of the balance + interest."

How can it be smaller? If it were just interest, then the balance would remain the same. Is it really what you expect from a CC?

ETA: I checked my HX Clarity's information from 2012 and it's the same "interest + 1%".

glentoran99

Did the letter come by a lost looking carrier pigeon? Because the law changed in 2011 and must be 1% plus interest and charges

YorkshireBoy

glentoran99 wrote: »

Did the letter come by a lost looking carrier pigeon? Because the law changed in 2011 and must be 1% plus interest and charges

More accurately...

For accounts opened from April 2011 the minimum payments will be at least the total of any interest, fees and charges plus 1% of the outstanding balance.

http://www.theukcardsassociation.org.uk/individual/minimum_repayments.asp

ie, it can be more...my Sainsbury's credit card is 2.25%.


So it seems the OP's relative opened their account before April 2011 (and were previously on 2% minimum payments).

[Deleted User]

I have paid 1% of balance on my halifax card for years, it is now going up to 1% + interest, on my balance that means up from £11 to £16 month as the interest rate is only 3%

AcN_2

I also got one of these letters today. It gave an example using December's bill and it said for me it would change the minimum repayment from about £250 to about £380 which for me is an increase that I just can't afford to pay so looks like I am in trouble.

And yes I know that is a massive balance but life happens sometimes and as I am unable to convert it into a loan to get it paid off I am stuck with it.

Frogletina

PurpleHat wrote: »

Hi folks,

Just wondering if any other Halifax credit card customers have been getting letters stating that the minimum monthly payment is being changed?

Lloyds are also sending these letters out - I got mine today.

Doctor_Duke

I can see how this will be an issue for many people who can't balance transfer away the outstanding debt. It's an interesting change by LBG. I have a few cards in the group and expect to get a letter or two but it won't affect me as don't have any that bear interest on a outstanding balance. Perhaps this is a way of LBG forcing the debt profile down as you will be forced to pay more of the outstanding balance off.

AngiBear

I got the same letter today and its an increase that is going to affect a lot of people. Thing is the letter doesn't really mention why the payments are going up so much. I think the PPI payments have cost the banks too much and this is their way of trying to recoup some of their money faster. I am going to try and increase my payments to them now even more, its actually spurred me on but a lot of people are going to struggle and I really feel for them.