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Credit Card Additional Payments

effortless
Posts: 52 Forumite
in Credit cards
Hi All,
I've recently opened a credit builder card with a £1k limit and a Direct Debit (IN FULL)
My plan is to keep it at 25% to show I'm using it but not going too mad.
I've been putting purchases onto the card, and my last statement balance was around £280.
Since then, I put a larger purchase on it, and then brought the balance back down with additional payments, one of £250 and one of £100.
Now, the app says "Thanks for making your min payment" which is now showing as £0, the same as the website. The payment due date is today and nothing has come out of the bank. The customer rep verified I have a full balance DD in place.
Should I wait another day or make another manual payment to bring the balance in line? Will I start getting charged interest?
I've recently opened a credit builder card with a £1k limit and a Direct Debit (IN FULL)
My plan is to keep it at 25% to show I'm using it but not going too mad.
I've been putting purchases onto the card, and my last statement balance was around £280.
Since then, I put a larger purchase on it, and then brought the balance back down with additional payments, one of £250 and one of £100.
Now, the app says "Thanks for making your min payment" which is now showing as £0, the same as the website. The payment due date is today and nothing has come out of the bank. The customer rep verified I have a full balance DD in place.
Should I wait another day or make another manual payment to bring the balance in line? Will I start getting charged interest?
0
Comments
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If you have a full pay DD, then the balance will be cleared. The only thing to watch for is whether it will be adjusted for recent payments.
But don't worry about making interim payments. As long as you stay under your limit, let the DD clear it in full. Your utilisation isn't an issue when you're not revolving the debt.0 -
Op you paid £300 out of £280 (overpaid £20) on your last statement balance during the current statement period (supposedly not yet finalised until a new statement is produced). Your Credit Card allow you to make such payments that if done early enough, will impact the DD (thus reducing it, in this case to £0).
The balance showing now would be the one on your next statement that needs to be paid in full by next DD date.
Lloyds group credit cards for examples used to allow you to do that but then changed and whatever you pay in the interim, the full DD value (min pay, fix amount or full balance, whatever is set) will still be taken on due date.0 -
Depending on who your provider is, as long as you set up a DD to pay in full, then the amount taken should automatically adjust to bring itself in line with the amount required to be paid. As long as you have sufficient funds in your current account, then the DD should also protect you against missed/late payments as it is now the lenders responsibility to ensure funds are taken with enough time to pay your bills.
I also wouldn't bother in future about trying to pay off the card manually - the only time you really need to do this is if your remaining card limit isn't high enough to make a purchase. The % utilisation is misleading and I wouldn't worry about trying to keep it within a certain amount. Think about it this way - lenders can see what you've spent and repaid so why should they care what your snapshot in time % utilisation is? If I had a £1000 limit card, spent £750 but paid off £500 - my "utilisation" on paper would be 25% even though I've actually 75% of my limit.0 -
Thanks all
It's Vanquis, I'm just concerned on what gets reported and if I end up paying interest at this nasty rate, and a snowball effect occurs.
Maybe overthinking it I don't want to see my balance go too high at the same time. Probably being paranoid, just want to stick within the terms and build credit as i go!
Edit: may have missed that I'm continuing to purchase on the card, so the current balance is £560ish0 -
Any payments you make once a statement has been produced will go against that statement. If those payments equal the statement balance then, with this particular card, no further payment is needed. No interest will be charged as long as you make payments equal to the statement balance by the due date. As long as you keep your balance at any moment in time below your credit limit all will be fine.0
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Forget about the utilisation stuff. The card is there to make your life easier by deferring payments for you; it's not there to make you paranoid or to rule your life.
Make sure you never exceed your credit limit and always allow your direct debit to collect the full statement balance. In general I wouldn't bother with interim payments although it does no harm - unless you have balance transfers on promotional rates (which you don't)
If you make additional payments and your direct debit is set to 'pay in full', Vanquis will adjust the amount they take accordingly. There is, however, a 3-day window prior to your direct debit going out where it is not advisable to make additional payments because Vanquis will not adjust their direct debit amount for any payments you make in that window.
Additional payments in this window would still be applied to your account (of course) but you might get yourself into a fix if your additional payment leaves your current account too short to accommodate the direct debit that Vanquis will be claiming. I hope that makes sense.0
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