Credit Card interest

purpleparrotuk

Have I misunderstood how credit cards interest works? If I purchase something before the statement date, do I have to pay it off before the statement so it doesn’t incur interest?

I thought once the statement is produced as long as you pay it off by the payment due date no interest would have been added. I spent £1200 a couple of weeks before the statement date and intended to pay it off when the statement came. But they have added £15 interest on the statement. I thought there is normally a grace period before they add interest?

I am trying to pay off the 22.42 interest one which is the total spent before the statement. Am I paying interest on it because I already have a balance (with a lower interest rate?) and I wouldn’t pay interest if this £1200 is all I had?

purpleparrotuk

in think I have answered my own question. If you already have a balance from last month there is no interest free period on new purchases.

p00hsticks

Yes, you need to pay the full balance shown on each statement by the payment due day in order not to get charged interest. You'll also find if you have a balance brought forward and then pay in full on the next payment day you'll get charged some interest on the following month too ('trailiing interest'). You need to pay in full for two months in a row to stop further interest accruing.

born_again

Any money paid before next statement goes towards balance on last statement.

Not just the interest.

Isthisforreal99

https://forums.moneysavingexpert.com/discussion/6656430/credit-card-interest

Yes, you have misunderstood.

Emmia

If you don't pay off the balance in full (e.g.by 1p) you get charged the interest on the whole balance that was due - you don't just get charged interest on the bit you didn't pay.

(This is presuming no interest free periods /offers apply)

MyRealNameToo

https://forums.moneysavingexpert.com/discussion/comment/81894532#Comment_81894532

Some cards do make an exception if the standing balance is on a 0% offer so ultimately you have to dead the terms of your particular card as not all do this. Looking at yours though all of it is interest incurring so likely you won't have any interest free period until you have paid two statements off in full