Money transfer from card with purchases already on it

MeeMawTucker

I’ve dug out a Barclaycard Visa that I haven’t used for a while, and spent about £400 on it this month. I can now see on the app I have an offer for a 0% money transfer which I’d like to do, so I can make an overpayment on my mortgage while the rate is high on that

How does it work with statements- ie to distinguish between the purchases that I’ll need to pay off, and the 0% money that will just sit there for 18 months. Will it be clear where the payment I make is going? I’ve done balance transfers etc before, but only on cards that previously had no balance on them. I don’t want to mess up and suddenly have to pay 26% on the money I take out (plus a 3.3% transfer fee)!

MorningcoffeeIV

Payments will be made as per the payment of allocation on your card.

Topline, that means highest interest statement balance first. Read the terms for further detail on situations such as have two balances at the same rate.

CliveOfIndia

You need to read the T&Cs very carefully.  Any payment you make will be allocated to the highest-rate portion of the debt first - i.e. the spending.  However, you need to check very carefully as to whether you'll be charged interest.  On some cards, if you pay off the purchases and the minimum payment towards the MT, you're still classed as not clearing the full balance, so you'll be charged interest on the purchase element.

Some cards are a bit more sophisticated and will differentiate between the two balances, in which case you'll be OK if you pay off the purchases.  Check the T&Cs very carefully - but the safest way is to clear the existing balance first, then do the MT, then don't use the card for any further purchases.

MeeMawTucker

Thank you both. I would say it’s still not exactly clear in the Ts and Cs so I think the safest thing would be to wait for any more transactions to clear, then pay the o/s balance and THEN apply for the money transfer

I wish I’d noticed the transfer offer before using the card, but tbh it was a pleasant surprise anyway to see the offer there as I’ve had the card for decades!

CliveOfIndia

MeeMawTucker said:

 I think the safest thing would be to wait for any more transactions to clear, then pay the o/s balance and THEN apply for the money transfer

Absolutely, this is the safest way if there's any doubt.

Just to reiterate the advice I always give on such matters - make a note in your diary/phone/whatever as to when the 0% promotional rate expires, and make sure you've got money put aside to repay the balance in full by that date.  Or else make sure you make a payment to the card each month (more than the minimum) such that the balance will be cleared by the promotional end date.  Putting money aside into a savings account, whilst paying only the minimum each month to the card, can be beneficial if you're able to earn some interest on the savings.  But you do need to be disciplined enough that you don't touch that money in the interim.

Yes, you may be able to transfer any remaining balance to another card at the end - but this cannot be guaranteed, and it would be extremely inadvisable to just assume you'll be able to do so.

grumbler

MeeMawTucker said:

I’ve dug out a Barclaycard Visa 

https://www.barclaycard.co.uk/personal/credit-cards/your-interest-rates-and-balances

MeeMawTucker

Oh! That’s a better explanation than I had in my stored Ts and Cs. Thank you 😊

 I wonder if it works the same the other way round - as in, the purchases come first and then the money transfer. I’ll have a look online

grumbler

I'm fairly sure it does.

We don’t charge interest on purchases that are paid in full if a card also has a promotional balance. You can get up to 56 days interest free on new purchases. If you’re carrying over a balance from a previous month (excluding any promotional balances), you’ll need to clear it before you can benefit from interest-free credit on new purchases. Don't forget to stay within your credit limit.

Just:

• Pay your purchases off in full by your payment due date and;
• Make sure that this payment covers at least the minimum payment on your statement

NorwichMan

I have a Barclaycard Rewards card, and did a sizable 0% money transfer in September, whilst there were existing purchases on the balance. I paid the previous full statement balance on time at the end of September and was charged zero interest on the following statement issued early October (which included the money transfer). I have continued to spend within the limit, and have just now manually paid the purchases total from the October statement (which is over the minimum payment). I'm expecting that when the next statement is issued in early November, there will be zero interest charged.

(Hope this is helpful, but obviously do check your own card terms and conditions as they might be different from mine)

Martico

I've found Barclaycard to be pretty good with this kind of thing. I had a 0% balance transfer on the go, and an annual sub that I'd forgotten about went out on the card. Paid the total of the sub before the following statement and was charged nothing in interest

MeeMawTucker

Thank you all; it does sound like it would work out, similarly to @NorwichMan above

I’m feeling impatient as I really want to make sure the money is working for me, so I’m torn between doing the sensible thing and waiting, or just going ahead and taking up the money transfer offer straight away. It says apply before end of November, so hopefully they won’t withdraw it though?

It’s a 3.3% fee for 0% until 1st May 2025 which I think is quite good (works out 2.2% pa, where the tracker bit of my mortgage is 5.5%)  I’m noting the very sound reminder from   @CliveOfIndia about not assuming I can transfer the balance over again at the end, as I do have some bonds maturing in time to pay it off