Questions about Balance Transfers

Mr87

tomkut said:

Deleted_User said:

Santander absolutely agree with me.

If you don't clear the balance in full, you're charged interest.

In your first reply you said the balances are separate, in which case it is right to assume that one can pay off the purchase balance on its own. In your second reply you contradict it. It makes no sense, neither does the info in 3rd golden rule, nor the santander documentation

zx81 response does make sense, and so does Santander's documentation. See my response above.

To go further with the example I gave, once the spending has hit your statement, you could then clear it the following month, leaving the 0% balance behind. Completely consistent with all of the above. 

Edit: you can only clear the purchase balance once it has hit your statement, by then it is too late. That is why it is suggested you NEVER spend once you've transferred a balance.

tomkut

Mr87 said:

@tomkut this used to confuse the hell out of me. It's due to the allocation of payments as @Deleted_User says. If you have a 0% balance on your card, and then do spending on it, you will get charged interest on your spending unless you pay off the ENTIRE balance in full (that is, the 0% and the interest bearing purchases). If you make a part payment before your statement (but after your purchase) the payment reduces the 0% balance, not the interest bearing balance. If the purchase hits your statement, it's too late - interest is charged.

@Mr87, Allocation of payments reads:

If you do not pay off your balance in full, payments we receive are applied to the highest interest bearing

transactions first.

Hence purchases should be cleared first, before 0% balance transfer.

How can one be charged interest for to-be-yet-statemented transactions?  purchases are up to 56 days interest free!

Mr87

@tomkut interest is backdated to the date of purchase. You only get 0% interest if you pay in full.

Have you read the small print on allocation of payments. It might say on statemented transactions.

Edit: I just looked at my Amex statement as an example. Interest free period 'Maximum 56 days on purchases IF YOU PAY THE FULL AMOUNT YOU OWE ON EACH STATEMENT DATE ON TIME EVERY MONTH' (emphasis mine).
and...
Allocation of payments - 'We pay off amounts you owe at the highest interest rates before amounts charged at lower rates and we'll apply payments to amounts THAT HAVE APPEARED ON YOUR STATEMENTS before amounts that haven't yet appeared on your statements.

In summary, a credit card is only interest free if you pay in full, or if you BT to 0% and don't spend on it.

[Deleted User]

That's correct.  The balances are held in separate buckets, which is how the allocation takes places.

But you still need to clear your ENTIRE balance for interest to be waived.

There's no contradiction, as the two process exist side by side.

The terms you've quoted are from Barclaycard, who are a separate company from Santander.  They are one of the very few exceptions to the whole balance rule.

tomkut

I am disappointed that barclays is not being praised everywhere, including moneysavingexpert for being sensible about what balance have to be cleared within 56 days to avoid interest! It just seems counter-intuitive.

I wonder if you could help with the timing that transactions are to be statemented. I cannot find any rules governing this in my agreement or T&Cs.

[Deleted User]

Posted transactions will statement on the next statement generated.  So anything from a day to a month.

gaz1892

Could I get a Barclays bank 0% credit card and pay off my overdraft on my Barclays bank account 

Mr87

@gaz1892 only if you got a money transfer card. You can't transfer an overdraft balance to a credit card.

tomkut

Deleted_User said:

Posted transactions will statement on the next statement generated.  So anything from a day to a month.

would I have any luck complaining that a transaction dated 9 march (history) is not included in the statement issued 11 march?

MallyGirl

Not a hope - it can take quite a while for transactions to make it through