Paying Interest on Cash Withdrawl on 0% CC

Hello!

I'm kinda new to credit cards and have got a 0% balance transfer card with Halifax to clear my old credit card.
I recently had to draw £900 off my credit card to pay for a car. I didn't realize this would mean I would have to pay interest on it (yes I'm stupid for not realizing or reading this). So I am currently paying interest on £900 but I have £2900 on the card. How do they work out when I have finished paying off the £900? Is it the first £900 off or the last or a percentage?

TIA
C xx
Read my diaryHere :)
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  • ndf9876
    ndf9876 Posts: 404
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    The order of payments will be specified on your statement, but typically the part of the balance that attracts the highest interest rate will be repaid first. There are some card providers (e.g. MBNA) that do things a little differently, but in this case I think it's clear.

    So in essence, the first £900 you pay off the card will go towards clearing the cash advance (plus interest), with the 0% balance transfer remaining untouched.
  • ndf9876 wrote: »
    The order of payments will be specified on your statement, but typically the part of the balance that attracts the highest interest rate will be repaid first. There are some card providers (e.g. MBNA) that do things a little differently, but in this case I think it's clear.

    So in essence, the first £900 you pay off the card will go towards clearing the cash advance (plus interest), with the 0% balance transfer remaining untouched.

    Thank you!!! :D
    Read my diaryHere :)
  • OceanSound
    OceanSound Posts: 1,482
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    edited 18 October 2018 at 5:21AM
    .....I recently had to draw £900 off my credit card to pay for a car. I didn't realize this would mean I would have to pay interest on it (yes I'm stupid for not realizing or reading this). So I am currently paying interest on £900 but I have £2900 on the card. How do they work out when I have finished paying off the £900? Is it the first £900 off or the last or a percentage?.....
    Be careful mixing balance transfer (0% deal) with cash transactions on the same card. I have a Halifax clarity card. Was really confusing at first. The folks on here gave some good advice and now I'm on top of things.

    Can I ask you one question? (okay, two questions). Was the balance transfer transaction(s) already 'statemented' (by that I mean appeared on a statement) when you did the cash withdrawal? If, yes, then any payments you make now will go towards paying that off. Once you clear that only then will you start paying off the cash transactions (£900). I've seen some posts, where customer thinks she is paying off the cash transaction balance, but all they've been doing is paying off a statemented (purchases/balance transfer) balance, and all the while their cash transactions had been charged interest.

    If you had £0 statement balance, then you do cash transaction and balance transfer within the same statement month, any payments you make afterwards will go towards clearing the cash transactions (because it earns interest at a higher rate).
    ndf9876 wrote: »
    The order of payments will be specified on your statement, but typically the part of the balance that attracts the highest interest rate will be repaid first. There are some card providers (e.g. MBNA) that do things a little differently, but in this case I think it's clear.

    So in essence, the first £900 you pay off the card will go towards clearing the cash advance (plus interest), with the 0% balance transfer remaining untouched.

    Not always, depends if there is a statemented balance.
  • chattychappy
    chattychappy Posts: 7,302 Forumite
    Simplest thing to do is WAIT FOR CASH WITHDRAWAL TO BE STATEMENTED, then pay it off immediately (don't wait for the due-by date).

    Given your "realisation", sounds like it already has!
  • OceanSound wrote: »

    Can I ask you one question? (okay, two questions). Was the balance transfer transaction(s) already 'statemented' (by that I mean appeared on a statement) when you did the cash withdrawal? If, yes, then any payments you make now will go towards paying that off. Once you clear that only then will you start paying off the cash transactions (£900). I've seen some posts, where customer thinks she is paying off the cash transaction balance, but all they've been doing is paying off a statemented (purchases/balance transfer) balance, and all the while their cash transactions had been charged interest.

    If you had £0 statement balance, then you do cash transaction and balance transfer within the same statement month, any payments you make afterwards will go towards clearing the cash transactions (because it earns interest at a higher rate).
    .

    The balance transfer happened in May/June time when I got the card and I drew the cash out in Sept

    C x
    Read my diaryHere :)
  • OceanSound
    OceanSound Posts: 1,482
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    edited 19 October 2018 at 9:41AM
    The balance transfer happened in May/June time when I got the card and I drew the cash out in Sept

    C x
    I don't know which card you have, but pretty sure any payments you make now will go towards paying off (clearing) the balance transfer from May/June.

    One way to confirm. Look in your latest statement. There should be a page titled 'summary box' (I assume all halifax credit card statements have the same layout). There you have section called 'allocation of payments'. Look for this:
    We will reduce the amount you owe in the following order:
    · any overdue amounts from previous statements;then
    · the remaining balance on your statement;then
    · any recent transactions not yet shown on your statement.
    Another way to check is to make a payment. Then after it's posted on to your account (can check this through onlinebanking) call halifax and ask them, 'did the payment go towards paying the balance transfer or cash wishdrawal'.

    If not, the only other way is to make a payment then wait for the next statement, where there will be 'breakdown of balance' by 'balance type'. I always felt that we shouldn't have to wait for the statment to arrive to see this, it should be avaialble through online/telephone banking.

    Anyway, if your latest statement says 'any overdue amounts from previous statements', your cash withdrawals will be incurring interest until you pay both the balance transfer amount and cash withdrawal amount.
  • Simplest thing to do is WAIT FOR CASH WITHDRAWAL TO BE STATEMENTED, then pay it off immediately (don't wait for the due-by date).

    Given your "realisation", sounds like it already has!

    To clarify - the advice is to wait until the cash withdrawal transaction is actually applied to the account. This means going online/using your app to verify that the cash transaction is no longer a pending transaction and has been applied to the account.

    If you pay as soon as the transaction moves from pending to appearing on the recent transaction, you'll only pay pennies in interest.

    PochiSoldi
  • Thank you everyone :D I have checked my latest statement and it says that the highest interest will be paid off first :)

    Cx
    Read my diaryHere :)
  • OceanSound
    OceanSound Posts: 1,482
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    edited 19 October 2018 at 1:26PM
    Thank you everyone :D I have checked my latest statement and it says that the highest interest will be paid off first :)

    Cx
    Just out of interest (sorry!, I'll get my coat shall I), how much will you pay? (take it your balance is £3800?, or is it £2900 combined for both balance transfer + cash withdrawals?)
  • OceanSound wrote: »
    Just out of interest (sorry!, I'll get my coat shall I), how much will you pay? (take it your balance is £3800?, or is it £2900 combined for both balance transfer + cash withdrawals?)

    Balance was £3326 with the £900 cash and next month they are saying I will pay around £15 interest but I am paying £50 off a week so will be less than that. I've paid off £410 since last statement.

    x
    Read my diaryHere :)
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