Didn't tealize the crdit card interest scam, do you?

Tribulation

OK, I understand the jist but am totally confused

Two different scenarios

1) You have an outstanding balance of £2000 on one credit card so you apply for another credit card with zero interest for 12 months on the balance transfer. You know you wont pay the whole £2000 off in the 12 months but at least the £1200 you do pay will be £1200 off of the debt.

As you haven't cleared the whole £2000 at the end of the free interest period, do you now get charged interest on the whole £2000 each month?

2) You have a card that you use each week. You've already got an outstanding balance on the card of say £1500
Each week you spend the food bill on the card.
Say £80 per week.
You get 45 days interest free
Each month you make the minimum repayments plus the approx £320 per month you've spent on food..

Does this mean that you are never paying off the approx £320 per month food money interest free, your constantly getting charged the full interest on it each month?

Hope that makes sense

many thanks

Phil

NickX

Tribulation wrote: »

1) You have an outstanding balance of £2000 on one credit card so you apply for another credit card with zero interest for 12 months on the balance transfer. You know you wont pay the whole £2000 off in the 12 months but at least the £1200 you do pay will be £1200 off of the debt.

As you haven't cleared the whole £2000 at the end of the free interest period, do you now get charged interest on the whole £2000 each month?

No, at the end of the interest free period you are left with £800 on the account, and you will start paying interest on this amount at the standard variable rate.

NickX

Tribulation wrote: »

You have a card that you use each week. You've already got an outstanding balance on the card of say £1500
Each week you spend the food bill on the card.
Say £80 per week.
You get 45 days interest free
Each month you make the minimum repayments plus the approx £320 per month you've spent on food..

Does this mean that you are never paying off the approx £320 per month food money interest free, your constantly getting charged the full interest on it each month?

In this instance you won't get any interest free period because you are leaving the £1500 balance on the card and not paying it back in full. Even though you are paying your £320 food bill, you are not actually clearing the account.

Unless you are in a promotional period, you will only get the 45-59 interest free days if and only if you pay the statement balance off in FULL.

This is the crucial point that seems to have caused much debate tonight.

YorkshireBoy

Tribulation wrote: »

1) You have an outstanding balance of £2000 on one credit card so you apply for another credit card with zero interest for 12 months on the balance transfer. You know you wont pay the whole £2000 off in the 12 months but at least the £1200 you do pay will be £1200 off of the debt.

As you haven't cleared the whole £2000 at the end of the free interest period, do you now get charged interest on the whole £2000 each month?

No, interest is charged each month on the outstanding balance. During the interest free period the interest rate was 0%. You'll be charged your typical interest rate for BT's at the end of the intro period, but only on the outstanding amount of £800. The difference between your scenario and the OP's is you have a 0% rate and the OP doesn't.

2) You have a card that you use each week. You've already got an outstanding balance on the card of say £1500
Each week you spend the food bill on the card.
Say £80 per week.
You get 45 days interest free
Each month you make the minimum repayments plus the approx £320 per month you've spent on food..

Does this mean that you are never paying off the approx £320 per month food money interest free, your constantly getting charged the full interest on it each month?

You only enjoy your 45 days interest free credit on purchases *if* you settle your bill in full each month.

[Deleted User]

Sorry this has to be one of the funnist things ive ever seen.

If dont understand how a credit card works then simply put, you shouldnt have one.

All people do is moan about CC companies and how they rip them off, but if they didnt make any money, they wouldnt be able to offer anyone the service. STOP MOANING.

NickX

Supercharge_Me wrote: »

Sorry this has to be one of the funnist things ive ever seen.

If dont understand how a credit card works then simply put, you shouldnt have one.

All people do is moan about CC companies and how they rip them off, but if they didnt make any money, they wouldnt be able to offer anyone the service. STOP MOANING.

Well glad its kept you amused tonight.

I think your comment is rather harsh especially given that these forums are supposed to be for people to get advice and help themselves get their finances in order.

I think in this case, people started to get somewhat worked up because several posters explained why he had incurred interest, but rather than say thank you and put it down to experience he continued to say that it was not correct even when everyone else could see that it was his mistake.

But I do maintain that CC Companies are businesses and they do want to make money out of the customers. If it were not for some of the tricks hidden in the Terms and Conditions it would be too easy and they would not make their profits.

CannyJock

Eydon wrote: »

Firstly it's red. Don't laugh - this is important. It was the main reason I applied for the card

You should look at the cards that allow you to put your own images on them. You could take digital pics of yourself holding up placards like a Bob Dylan video to help you tell the difference

CannyJock

PandaPants wrote: »

Shall we have a whip round for £6.38 to quieten him down?? :rotfl: :rotfl:

Sign up to Pigsback.com and you'll be able to earn £ 6.38 in a couple of weeks.

Or apply for an A&L Premier Direct account through Quido and get £ 50 back.

Lots of ways to get that money back

[Deleted User]

Al_Mac wrote: »

To be honest T&Cs are a lot better than they used to be. The problem is, people don't even read the adverts properly. They see a "good" thing and rush in blindly, ignoring the rest.

Ignorance is bliss eh?

NickX

Al_Mac wrote: »

To be honest T&Cs are a lot better than they used to be. The problem is, people don't even read the adverts properly. They see a "good" thing and rush in blindly, ignoring the rest.

Well the T&C's have improved, particularly with the Summary Box, but this was because they were told to make the facts clearer.

I'm afraid people don't read documentation, the number of threads that I've read on here where people have been sent a Credit Card and didn't even realised they applied - they thought they were completing a survey at the airport is a favourite.

All we can do here is provide advice when they get into trouble, but sometimes that advice is not what they want to hear.