Nothing to see here

Allenvik

Nothing to see here

Dobbibill

Hi - welcome to the forum.

Mixing purchases with a BT promo is not normally a good idea if your purchases aren't on a promo too.

Are the purchases on your statement when you make the payment or are they pending? This makes a difference to how the payments are allocated.

Terry_Towelling

Dobbibill is right and we've had this argument on the forum before. Because you have chosen to use the card as well as carry a balance transfer (BT) you are going to come unstuck unless you are careful.

Your payments are allocated only to the billed balance - this is covered by points 'a' and 'b' in the allocation of payments information you have quoted. Only if your payments are enough to more than clear the whole billed balance will they be offset against any new purchases only just being billed - this is covered by point 'c' in the allocation of payments information.

In your situation the billed balance was £5745.72 (£4836.71 BT plus £864.93 purchases unpaid from previous billing cycle plus £44.08 interest).

You then paid £2946.13 towards that balance. (£2300 + £500 + £146.13). That would be enough to completely clear the £864.93 of purchases and £44.08 interest carried over and £2037.12 of the BT amount.

Your new purchases of £1750.02 will not be touched by your payments because they haven't yet been billed and your payment was not enough to completely clear the billed balance.

So, you should have a balance to pay of £4549.61 and that balance will comprise £1750.02 of new purchases and £2799.59 of the BT. (For some reason my figures seem to be about £100 different to yours. Has an amount been quoted incorrectly somewhere in your listing?).

Dobbibill

Allenvik wrote: »

Hi Dobbibill,

Thank you for your reply.

I completely agree with you regarding not using the a CC with a balance transfer for other purposes, what happen is this card was a special case as I was away for months and had some direct debit bills set in to the card and also had to use it to pay for some commitments abroad.

It happens sometimes, as long as you are aware that you lose your grace period with the interest charges from the date of purchase. If you are stuck then needs must

Anyway, I don't know if I understood well your question regarding the monthly debits of or purchases (-£1547.03), the fact is nothing in the card was pending IMO, everything was straight charges.

Also when the first payment came, the bank took credit to the 'zero balance transfer' first, not the previews month debits with interest charges or the new month debits with the impending interest charges.

Thank you for you help, I still confused about this issue.

When you look back at your statements (paper/PDF downloads) do the purchases show on there at a statement entry?
It's important not to just look at the transaction list online and to look at the actual statement and cycle

Dobbibill

other than the BT amount, you will not have what you call 4th level of priority as you've sacrificed your grace period on purchases by adding them to a card with a BT sitting on it.

Every purchase you've made will have incurred interest from the date it was posted to the statement. (Each statement should have a breakdown of transactions posted). Your statement will be issued on the statement date with a due date clearly stated. Purchases will continue to incur interest from that statement date as they continue to do so until paid (whether on/before the due date).

Without statement amounts/transactions including dates/due dates etc it's difficult to say where the payments have been allocated.

Terry_Towelling

When you receive a statement any payments you make before your next statement is produced will be applied as follows:-

(a) any unpaid arrears or amounts over the credit limit; (you had none of these)
(b) the amount you owe as shown in your statement; (that was £5745.72)
(c) any transactions, interest or charges not yet included in a statement. (that was the £1750.02)

So the statement before the one you have itemised would have had a balance owing of £5745.72. The payments you then made of £2946.13 were firstly applied to that balance - and within that balance they would be applied to the previous purchases and interest first (£864.93 and £44.08) and then to the BT amount (£4836.71). Only if you'd paid enough to completely clear all of those amounts (£5745.72) would the bank start to apply your payments to the unstatemented items totalling £1750.02 (as per section c above).

Your £2946.13 was enough to clear the previous purchases, the interest and some of the BT amount but not enough to start 'eating into' the unstatemented transactions of £1750.02.

When you come to pay the statement where the £1750.02 has actually been billed to you, your payments will be applied to that and any interest first and then to the remainder of your BT and then to any future unstatemented items.

molerat

If you are certain your calculations are correct and you can present them along with how the bank has calculated and allocated differently from the terms then raise a formal complaint and take it to the ombudsman if you are not happy with their reply.

Allenvik

Nothing to see here

Terry_Towelling

Allenvik wrote: »

1st - Why you are not considering the other monthly debits part of the statement if they are clearly listed? I still confused with this view. I have debits, they appear on the Statement, I am asked to pay, If I don't pay them I will be charged, but gain they are not part of the bill or "unstatemented transactions"?

Where you are getting confused is in understanding exactly which statement your payments relate to. When you get a statement, any payments you make after the statement date but before that statement's payment due date will be applied to the items shown on that statement only. Your payments of £2946.13 were made before this statement was produced, so those payments will have been applied to the balance you owed in your previous statement.

Dobbibill

Allenvik wrote: »

the Bank decision to credit the BT first generated interest from the monthly debits that otherwise I wouldn't be charged.

This is not how it works.
You adding purchases to a card carrying a BT offer means you do not get any interest free grace period on purchases at all.
Interest was always going to be charged on purchases unless you paid them the day they were posted to the account. (this is on the assumption all other transactions were paid for excluding the BT offer)

Terry_Towelling

Happy New Year to you too, Allenvik.

In a previous post you wrote the following:-

“If the amount you pay in a month is less than the full amount you owe, we will apply the amount you pay in the following order:
(a) any unpaid arrears or amounts over the credit limit; (not relevant to you)
(b) the amount you owe us and shown in your statement; (relevant to you)
(c) any transactions, interest or charges not yet included in a statement. (this is the part that has caught you out because at the time of your payments the 'new' spending had not appeared on a statement)
We will apply your payment first to amounts on your account which we charge at the highest interest rate followed by amounts we charged at lower rates. In each case, interest and charges are paid o¡ first. If some amounts are charged at the same interest rate, we will apply your payment to the oldest amounts first.”

So when you get a statement, the balance owing as stated at the end of that statement is what you then need to pay. All payments you make from that point until the payment due date will be allocated to that balance only - and they will be allocated in the order shown. Only if you pay more than the total billed balance shown, will the bank allocate any of your payments to unstatemented spending, and they will do that allocation of payments last of all (point c above).

When you made payments totalling £2946.13, these showed up on your statement but they were payments made towards the billed balance from the statement before. Because your payments didn't cover the entire balance owing, none of them would be allocated to your new spending because it hadn't been statemented at the time you made those payments.

I'm not sure I agree with what DobbiBill has said about paying the purchases as soon as you make them. That wouldn't work at all because the payments you make all go to settle the previously statemented balance (in the order specified by the bank) and they will never go towards your unstatemented spending unless you clear the previously-billed balance completely first.

If you are combining a BT offer with new spending you need to pay your statements after they arrive and remember to fully clear the value of any new spending and interest that appears on that statement to avoid interest. You can't do this now because there will be trailing interest for an extra month but beyond that it will work.