Credit card payments

edited 30 November -1 at 1:00AM in Credit Cards
8 replies 1.1K views
WarmappleWarmapple Forumite
2 Posts
edited 30 November -1 at 1:00AM in Credit Cards
Hello,

I made a purchase on the 19th of December 2017, of £718 on my credit card. On the 10th of January 2018. I made a payment of £718 to clear the balance of the purchase.

But the payment that I made came off a 0% offer that I have on the card rather than the purchase.

I have called my credit card company and they say basically.. Because I paid it too EARLY (the next day would have been fine) The money came off the 0%.

So I have now been charged interest since the 20th of December 2017 on the £718.

Is this right?? I have had to put in a complaint and a manager is going to call me back.

Replies

  • eskbankereskbanker Forumite
    19.2K Posts
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    ✭✭✭✭✭
    Yes, it's right - it sounds like you paid the day before the statement containing the £718 was issued and therefore the payment would have been applied to the balance from previous statements, which is quite normal and will be explained in the Ts & Cs.

    So, you'll still owe them the £718 and associated interest on that, which should have shown on the January and February statements - what payments have you made over and above the minimum since 10 January?

    You might get lucky if you plead ignorance and ask nicely for them to make adjustments to square everything up again, accepting that it's your mistake, but if you go steaming in with a complaint then it's less likely that they'll treat you sympathetically....
  • Thanks for the reply,

    Yes it does show on the other statements, but I only just noticed when I got this months.

    I never made any payments above the minimum since because as far as I knew I was only at 0%.

    There is no steaming in with a complaint. The person on the phone said it was my only option as she couldn't do anything (even she didn't understand why it had come off the incorrect (in my opinion) balance.)

    Assuming the above is true how can they charge me interest from the purchase date but not use money paid off after then (but not before the next statement) If they pay off the balance with the highest interest. This is having your cake and eating it?? Interest in that case should have been charged from the 11th Of January. I feel very cheated.

    I am yet to find it in the T&C...
  • YorkshireBoyYorkshireBoy Forumite
    31.5K Posts
    Part of the Furniture 10,000 Posts Name Dropper
    ✭✭✭✭✭
    Warmapple wrote: »
    I am yet to find it in the T&C...
    Who's the provider?
  • eskbankereskbanker Forumite
    19.2K Posts
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    ✭✭✭✭✭
    Warmapple wrote: »
    Assuming the above is true how can they charge me interest from the purchase date but not use money paid off after then (but not before the next statement) If they pay off the balance with the highest interest. This is having your cake and eating it?? Interest in that case should have been charged from the 11th Of January. I feel very cheated.

    I am yet to find it in the T&C...
    All credit cards that I'm aware of work on the principle that interest is payable on a balance unless it's paid off in full by the due date of the first statement on which it appears.

    If interest does become due in these circumstances then it's charged from the transaction date not the statement or due date.

    Your minimum payments made in January or February will have been applied to the £718 balance, but equally they'll probably have been largely offset by the interest that will have been added each month.

    On the other hand, if you have clear evidence on your statements that the minimum repayments haven't been applied to the chargeable transaction (i.e. that they've continued to reduce the promotional balance) then that wouldn't be right and would warrant further discussion with them....
  • chattychappychattychappy Forumite
    7.3K Posts
    ✭✭✭✭
    Following perceived unfairness, the so-called "negative payment hierarchy" was abolished. CCs were meant to apply payments received to the balance bearing the highest interest rate first.

    The T+Cs I have seen usually interpret this as applying payments to statemented balances first - and then within those balances to the highest interest bearing balances first.

    So you do need to see the T+Cs first.

    I think there is a question as to whether applying payments to a statemented 0% balance in preference to an unstatemented interest bearing balance breaks the spirit of what was agreed (presumably with the regulator), but it would be a difficult argument to run.
  • Ben8282Ben8282
    4.8K Posts
    1,000 Posts Combo Breaker Newshound!
    ✭✭✭✭
    What has occurred is perfectly correct. You should have waited until the statement had been issued and then made the £718 payment. Or even better, you should never have used the credit card with the balance transfer on to make the purchase in the first place as obviously, in the absence of an offer on purchases, you would have had to pay interest on it.
  • chattychappychattychappy Forumite
    7.3K Posts
    ✭✭✭✭
    Ben8282 wrote: »
    What has occurred is perfectly correct.

    I don't think we can be so categorical until we have seen the T+Cs for the card in question. Certainly I've seen T+Cs where it refers to higher interest bearing balances being paid off first without any reference to whether they are statemented or not.
  • moleratmolerat Forumite
    25.2K Posts
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    ✭✭✭✭✭
    The only card out of my 6 that would apply the payments to unstatemented amounts is MBNA.
This discussion has been closed.
Latest MSE News and Guides

Covid test firms form self-regulating body

A bid to tackle poor service concerns

MSE News

Cheap home insurance

Grab 100+ quotes & cashback

MSE Guides