Barclaycard Existing Customers Loophole Discussion

Former_MSE_Andrea

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Barclaycard Existing Customers Loophole Article

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creditman

This offer which was due to end at the end of the month has now been changed on the Barclaycard website to 6.9%.

MSE_Martin

Quite right it has changed. And the article has now been changed. Actually your post didnt just prompted me - the Barclaycard press office saw it and spoke to their product team - first it'd heard as well

(you can read more details about this in m'new blog which i'm launching later this week)

Milarky

If I understand this thread, it's drawing attention to the fact that Barclaycard's standard terms and conditions offers new cardholders a 6.9% life of balance rate, but that they also make this available at other times too - but this isn't stated as a term & condition? [I've just looked at my old agreement and the 6.9 rate is only decsribed as for new customer offer - see term '3.4' ]

What about second cards? As I understand it existing customers are eligible to apply for a second Barclaycard [a 'Mastercard' if you already have 'Visa' and vice versa] which comes with the 6.9 life of balance offer? Could this not be be a better option sometimes - I've not seen the second card [and it's possible uses] discussed much here.

dag_2

I don't think this offer is peculiar to Barclaycard. I've had a Lloyds TSB Classic card for a while - and whenever I've asked about balance transfers, they've usually offered me 6.9% for life of balance. It's not written down anywhere, and they don't mention it on the web site.

Also - a while ago, I had a balance on a Halifax Classic card. They kept on sending promotional cheques out, but the interest rate was ridiculously high, over 17% APR. I've now cleared the balance. They still keep sending the promotional cheques - but the rate has plummeted to 6.9% life of balance - as long as I use the cheques before a certain date. Even if I don't bother, they invariably send me more cheques a few weeks later.

Pity they can't beat my cahoot flexible loan, which is also at 6.9%. Oh well.

baby_frogmella

Hi
Why on earth do Barclaycard charge 2% handling fee for all balance transfers? Is this a norm for all credit card companies now? Cos last time i did a balance transfer (couple of years back) i wasn't charged any fee!!!!....uurrrrgggggghhhh makes me so angry!!!

Buzz67

Can anyone tell me how this offer would work with the 0% rate for balance transfers that Barclaycard were hammered on. I've got the Barclaycard Platinum card and spend 10p per month (by Paypal account!) thus not getting charged interest for the balance transfer I made to it. My question really is what will happen if I balance transfer to Barclaycard from my Capital One card, will I be charged 6.9% or 0%? Are you still able to balance transfer for 0% on Barclaycard Platinum or has that ability ended?
Phew, lots of questions for my first post!!!

Milarky

baby_frogmella wrote:

Hi
Why on earth do Barclaycard charge 2% handling fee for all balance transfers? Is this a norm for all credit card companies now? Cos last time i did a balance transfer (couple of years back) i wasn't charged any fee!!!!....uurrrrgggggghhhh makes me so angry!!!

Barclaycard have had the 2% fee written into their T&Cs quite for some time - but have often waived the right to charge in order it to drum up business. Only latterly have they chosen to apply fees to new account holders as a 'standard'.

[Someone has posted on a different thread recently that there was a 0% offer -probably with 2% fee for new customers coming in June but no details as yet. Let's discuss a scenario here, just to pass the time....

BC applies payments to the lowest rate first. Therefore if you aready have a life of balance rate on your BC [say 5.9%, with no fee, which was the most recent offering to exisiting customers] and they kindly up your credit limit to allow you to take advantage of such an offer - 0% for 9 months say with 2% fee - between what you had outstanding and 90% of the new limit - they ought to start collecting payments on this balance first, since it is [for now] at a lower rate than your other balances. For once it would make sense to be paying the 0% balance off first in this way - because it will revert to a much higher after 9 months. The 'trick' I am imagining is that 9 minimum payments plus a shunt at the end will just exactly clear out the 0% balance as it is due to leap up to 15.9% or whatever. Then, because the residual balance would simply consist of the remaining 5.9% life of balance you would move on to paying this off and no nasties. Why would you bother to borrow for just 9 months and pay a 2% fee? Well, it equates to borrowing at around 2.7% - which is cheaper than the 5.9% isn't it?

YES, before anyone says: "why not pay off the whole of the 5.9 then just transfer the whole the balance back at 0% plus fee?", it might save you money in the short run, but leaves you vunerable because you then definitely have to hunt around for more deals]

zcaprd7

Buzz67 wrote:

Can anyone tell me how this offer would work with the 0% rate for balance transfers that Barclaycard were hammered on. I've got the Barclaycard Platinum card and spend 10p per month (by Paypal account!) thus not getting charged interest for the balance transfer I made to it. My question really is what will happen if I balance transfer to Barclaycard from my Capital One card, will I be charged 6.9% or 0%? Are you still able to balance transfer for 0% on Barclaycard Platinum or has that ability ended?
Phew, lots of questions for my first post!!!

I wouldn't touch your card if you have that deal - it was one of the best - any subsequent transfers won't be as good, and will get paid off last as well...

Milarky

Buzz67 wrote:

Can anyone tell me how this offer would work with the 0% rate for balance transfers that Barclaycard were hammered on. I've got the Barclaycard Platinum card and spend 10p per month (by Paypal account!) thus not getting charged interest for the balance transfer I made to it. My question really is what will happen if I balance transfer to Barclaycard from my Capital One card, will I be charged 6.9% or 0%? Are you still able to balance transfer for 0% on Barclaycard Platinum or has that ability ended?
Phew, lots of questions for my first post!!!

Welcome Buzz67,

If you have that '0% for life' card and only have to spend 10p a month [not the '£50' one which was withdrawn] then you've asked a very good question.

A transfer today would at 6.9%. The trouble with that is that your old deal has a default life of balance rate [if you don't spend in a particular month] of '6.9%' also. Had the newer rate been 5.9% then I'd hazard that they would take that off first since 5.9 is lower than '6.9' even if you don't actually pay 6.9 on it because of the way you are using the card. But if you put a rate of 6.9 with 6.9 then it's anybody's guess.[NOTE I have 2.9 life of balance on top of the original 0/6.9 and they are taking off the 2.9 first since technically its a 'lower' rate. What you'd need is: something lower than 6.9 with 'life of balance']

Actually let me quote what Barclaycard themselves say about this [wef from 23 Feb 2004]:

"If you're paying several different rates, and only pay off part of the balance, we'll reduce the upaid amountsin this order:

(a) any fixed special rate balances, including interest on them - lowest rate first.

(b) any special rate balances (and the interest on them) with a set end-date - lowest first

(c) any other interest or special charges (e.g. late payment)

(d) cash withdrawals

(e) your standard balance."

[taken from BC 'clear as crystal' leaflet - Feb 2004]

That doesn't answer the point however if both balances are 'fixed' rates and both at the same rate - it's still undecided. It could come off the '0 or 6.9' balance first, or off the 'always 6.9'.

But it does at least clear up my muddled thinking in my previous post where I suggested that a short term 0% added to a fixed 6.9% would reduce first just because it was at a lower rate - it wouldn't I now realise because it would count as a type 'b' balance rather than a type 'a'

So my own idea would have to be modified to:

If you already have a 5.9 life of balance on your BC and they offer you 0% for 9 months then only take this if your are confident of being able to shift that whole balance at the end of the nine months. If you were going to do that anyway then it makes more sense to just clear the 5.9 to another card and then BT back to BC at 0% on the whole balance

Rafter

baby frogmella,

Two years ago not as many people had cottoned on to the fact that they could stooze or pay no interest on their borrowings just by moving them every 6 months or so.

Barclaycard and others started to lose money so imposed a fee to discourage this.

There are still a few out there who don't charge, Virgin for one, but not sure how long this will last.

R.