Total Interest Charge

S3quence

Hi,

I made an application for a HSBC 0% for 12 month credit card. I need this solely for paying for my exams (which my work pay for). The way my works expenses work out I need to pay for the exams and claim them back the following payday. The idea being I can put it on the card claim my expenses and pay it off in full. The exams are £88 each and I need to do 2 exams a month for the next 3-4 months. also I thought it would be good to have the card in the house in case anything important came up and needed it immediately.

Anyway this seemed ok until they posted the forms to sign and the 2nd page has a Total Charge for Credit: £81 !!!

!!!!!!! as far as I can see there is a £81 charge for setting up a credit card?

Is this normal I have never had or enquired about a credit card so dont know if this is standard but if this is the case the exams will have to go on hold!!!

Is this correct and is there anything else with credit cards I need to look out for? I intend to pay the card in full for the exam periods then lock the card at home for an in emergancy case

CLAPTON

i think you will find it is a statutory example that shows how much interest you would pay if you borrowed 1000 and paid it off over a year or whatever

S3quence

CLAPTON wrote: »

i think you will find it is a statutory example that shows how much interest you would pay if you borrowed 1000 and paid it off over a year or whatever

No that is in a seperate booklet in the back, showing an example for the different payments (ie £50 a monthm, £100, minimum.

This is in the "Key Financial Information" and under a subheading of "Other Financial Information"

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Total Charge for Credit
Comprised of the following:
Total Interest Charge £81.92
Annual Fee of £0.00

---

What is strange is coincidently I got a mailshot for the same credit card for HSBC and it has the same forms but pre-printed and the Total Interest Charge and Annual Fee are both £0.00 on that!

YorkshireBoy

S3quence wrote: »

No...

Er, the answer is YES. Clapton has explained EXACTLY what it is...an example.

You will find the exact explanation further down your T&C's/credit agreement (tell me which card and I'll show you where it is), but in essance it'll read something like the following...

The total charge for credit (TCFC) is the interest charged if you were to make a purchase of £1,500 (or to the value of your credit limit in this case, because your TCFC figure is too small for the £1,500 to apply), and then pay it off in 12 equal monthly installments...assuming there is no introductory offer on your account.


EDIT: See the Capital One example here http://forums.moneysavingexpert.com/showthread.html?t=632705 (post #3)

S3quence

YorkshireBoy wrote: »

Er, the answer is YES. Clapton has explained EXACTLY what it is...an example.

You will find the exact explanation further down your T&C's/credit agreement (tell me which card and I'll show you where it is), but in essance it'll read something like the following...

The total charge for credit (TCFC) is the interest charged if you were to make a purchase of £1,500 (or to the value of your credit limit in this case, because your TCFC figure is too small for the £1,500 to apply), and then pay it off in 12 equal monthly installments...assuming there is no introductory offer on your account.


EDIT: See the Capital One example here http://forums.moneysavingexpert.com/showthread.html?t=632705 (post #3)

Thanks for putting it so abruptly! Ok if that is so why a few pages on does it have just that set example.....

Interest for paying the minimum payment, Interest for paying £50 a month, Interest for paying £100 a month

On the page in question it just has the following....

Credit agreement between me and HBSC then the followiung subheadings...

Credit Limit: to be determined at a later date
Repayments: 2.5% or £5 minimum

then the excerpt above...

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Total Charge for Credit
Comprised of the following:
Total Interest Charge £81.92
Annual Fee of £0.00

---

the pages then end somewhat 2/3 of the way down and the next page has new subheadings for Interest rates and then introductory rates

I can see what your saying though what doesnt make sense to me is that the mailshot with the printed form (a better formated version of the letter HSBC sent me) has all the same information yet in the total charge for credit it says £0.00?

Also at what point do they normally set the credit limit? aas i assumed I would know this before signing anything?

Thanks