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    • Curls2208
    • By Curls2208 4th Nov 17, 10:49 AM
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    Curls2208
    Halifax Clarity Card 'interest'
    • #1
    • 4th Nov 17, 10:49 AM
    Halifax Clarity Card 'interest' 4th Nov 17 at 10:49 AM
    Good morning,

    SO I have had an interesting one. I have a haifax clarity card which I pay off in full every month.

    However I have noticed these past 2 months I have been charged 'interest' on the 1st of the month.

    Now I haven't used it in an ATM (well not since summer where i paid it off instantly) and i pay off the full amount each month, so I have no idea why I would be charged interest?

    It is a minute amount of pennies, but I have no idea why they're charging. Has anyone else come accross this with this card? Have i missed something in the smallprint?
Page 1
    • zx81
    • By zx81 4th Nov 17, 11:29 AM
    • 16,869 Posts
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    zx81
    • #2
    • 4th Nov 17, 11:29 AM
    • #2
    • 4th Nov 17, 11:29 AM
    Check to see if any of your transactions are cash or quasi cash, e.g. Gambling, foreign currency, etc.
    • Curls2208
    • By Curls2208 4th Nov 17, 3:43 PM
    • 50 Posts
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    Curls2208
    • #3
    • 4th Nov 17, 3:43 PM
    • #3
    • 4th Nov 17, 3:43 PM
    I think that could be the case.

    The receipt says that....so I may have used it for a bet on football or something perhaps?

    If I pay the card off in full it should cleat that though right, and only have the interest for one month?
    • bigadaj
    • By bigadaj 4th Nov 17, 4:48 PM
    • 10,816 Posts
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    bigadaj
    • #4
    • 4th Nov 17, 4:48 PM
    • #4
    • 4th Nov 17, 4:48 PM
    I think that could be the case.

    The receipt says that....so I may have used it for a bet on football or something perhaps?

    If I pay the card off in full it should cleat that though right, and only have the interest for one month?
    Originally posted by Curls2208
    You'll get a very small amount if trailing interest the following month and then no interest if you lay in full and in time every month.
    • Dobbibill
    • By Dobbibill 4th Nov 17, 4:48 PM
    • 3,082 Posts
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    Dobbibill
    • #5
    • 4th Nov 17, 4:48 PM
    • #5
    • 4th Nov 17, 4:48 PM
    You will need to pay your statement in full twice to stop the trailing interest.

    Statement 3 will revert back to normal.
    I'm a Board Guide on the Energy, Student Money Saving, UK Armed Forces and
    Local Money Saving - Wales boards. I'm a volunteer to help the boards run smoothly, and I can move and merge posts there.
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.


    It's not about being the best -
    It's about being better than you were yesterday.
    • Curls2208
    • By Curls2208 4th Nov 17, 5:01 PM
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    Curls2208
    • #6
    • 4th Nov 17, 5:01 PM
    • #6
    • 4th Nov 17, 5:01 PM
    Thank you all. Good to know. By the way I'm newish to the forum, been lurking for a while, so many useful tips here!
    • Jlawson118
    • By Jlawson118 8th Nov 17, 6:32 PM
    • 885 Posts
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    Jlawson118
    • #7
    • 8th Nov 17, 6:32 PM
    • #7
    • 8th Nov 17, 6:32 PM
    When I first got the card, I did a Balance Transfer from one of my other cards. I think the fee was 9.9% on a balance of 350 I think. I was waiting for a payment to come through so I needed a few more weeks, got charged 30 to do so which was to be expected but they kept taking monthly interest for a while, even though I'd paid it off in full before the bill date.

    I contacted customer services who said it was due to the balance transfer. Even though upon my phone application I'm almost sure they said I'd get 0% transfers. But that might have been another card they were trying to sell. So I didn't argue. But customer services offered to refund me the interest and I told them it was fine as long as I knew what they were for. For the sake of a few pence it wasn't much of a big deal.

    Haven't been charged since.

    Have you done any Balance Transfers?
    • PeacefulWaters
    • By PeacefulWaters 8th Nov 17, 9:16 PM
    • 8,320 Posts
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    PeacefulWaters
    • #8
    • 8th Nov 17, 9:16 PM
    • #8
    • 8th Nov 17, 9:16 PM
    When I first got the card, I did a Balance Transfer from one of my other cards. I think the fee was 9.9% on a balance of 350 I think. I was waiting for a payment to come through so I needed a few more weeks, got charged 30 to do so which was to be expected but they kept taking monthly interest for a while, even though I'd paid it off in full before the bill date.

    I contacted customer services who said it was due to the balance transfer. Even though upon my phone application I'm almost sure they said I'd get 0% transfers. But that might have been another card they were trying to sell. So I didn't argue. But customer services offered to refund me the interest and I told them it was fine as long as I knew what they were for. For the sake of a few pence it wasn't much of a big deal.

    Haven't been charged since.

    Have you done any Balance Transfers?
    Originally posted by Jlawson118
    No chance of them having a BT fee that high.
    • chattychappy
    • By chattychappy 8th Nov 17, 11:18 PM
    • 6,771 Posts
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    chattychappy
    • #9
    • 8th Nov 17, 11:18 PM
    • #9
    • 8th Nov 17, 11:18 PM
    No chance of them having a BT fee that high.
    Originally posted by PeacefulWaters
    Yep. Unless it was a minimum fee or the usual APR (don't think they do an APR that low).
    • OceanSound
    • By OceanSound 17th May 18, 9:11 AM
    • 171 Posts
    • 26 Thanks
    OceanSound
    Made an ATM withdrawal abroad last month, which I figured would come to 154.14 (using online banking available balance). So even before it appeared on recent transaction I transferred 154.14 to the clarity account from current account.

    Transaction appeared a couple of days later and it came to 156.50 (I think the figure using available balance is only an indication). So I made another payment of 2.36 to cover the difference. During April I made some purchases all amounting to 140.41.

    Received electronic statement today. It has an interest charge of 1.68. In section called 'breakdown of balance' it's showing whole of the 1.68 was for 'cash transactions'. Not only that, it's showing the outstanding balance for 'cash transactions' as 146.68 (See below)

    I thought payments are allocated in a specific order. i.e. if two types have identical interest rate (which is what it is here: 18.95% for both cash transactions and purchases) then balance is paid off in this order:
    cash transactions, purchases, balance transfers and money transfers, and then default charges (plus any interest or charges incurred as a result of those balances).
    At least that's what the statement says.

    How on earth did the interest come up to 1.68? I know it's not a lot...the sun will still rise tomorrow, birds will sing etc. etc. But I'm not convinced the payments have been allocated properly.
    • Vortigern
    • By Vortigern 17th May 18, 9:30 AM
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    Vortigern
    I thought payments are allocated in a specific order.
    Originally posted by OceanSound
    Yes, Payments are allocated first to the statemented balance.

    So, to avoid interest you have to pay off the whole of the previous statement balance, plus the amount of the cash withdrawal.

    Also, don't attempt to pay off the cash before the transaction appears online, otherwise your payment could go to recent purchases rather than the cash withdrawal that Halifax haven't seen yet.

    Make another payment of 146.68 now, to avoid further interest.
    Last edited by Vortigern; 17-05-2018 at 9:33 AM.
    • zx81
    • By zx81 17th May 18, 9:31 AM
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    zx81
    The payment was allocated properly. It was put to the highest statemented balance.

    Remember to wait until the transaction has posted on your statement next time.
    • OceanSound
    • By OceanSound 17th May 18, 9:37 AM
    • 171 Posts
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    OceanSound
    Yes, Payments are allocated first to the statemented balance.

    So, to avoid interest you have to pay off the whole of the previous statement balance, plus the amount of the cash withdrawal.

    Also, don't attempt to pay off the cash before the transaction appears online, otherwise your payment could go to recent purchases rather than the cash withdrawal that Halifax haven't seen yet.

    Make another payment of 146.68 now, to avoid further interest.
    Originally posted by Vortigern
    I had a statement balance of 10 for March. Even if that was paid off first, the balance from my payments 146.50 (156.50 - 10.00) should be allocated to cash transaction, no?
    • chattychappy
    • By chattychappy 17th May 18, 10:00 AM
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    chattychappy
    I had a statement balance of 10 for March. Even if that was paid off first, the balance from my payments 146.50 (156.50 - 10.00) should be allocated to cash transaction, no?
    Originally posted by OceanSound
    But what was your unstatemented balance at the moment you sent payment? Were there unstatemented purchases?

    Really a transaction goes through 3 stages (my choice of words):
    1) Authorised/pending. Reduces your available balance immediately. You won't normally see them online, though you might do if you choose to view pending transactions. Sometimes pending transactions never go through (eg in the case of hotel deposits) and eventually disappear.
    2) Posted. Might take a day or so in the case of ATM transactions. This is when you first see the transaction on the account.
    3) Statemented.

    I'm wondering if those April purchases were posted on the account, albeit unstatemented when you sent the payment. Because the ATM withdrawals were still pending and not yet posted, your payment hit the purchases first. (You worked out the amount from the available balance which would indeed have reduced because of the pending ATM activity.)

    I've used Clarity for a few years and haven't had the problem you've had. I might sometimes pay off an ATM withdrawal the moment I've made it (without waiting for it to appear on the account), but not when there are purchases on the account.

    Two ways to avoid the problem:
    1) wait for the ATM transaction to post (not merely appear as pending or reducing your available balance); or
    2) after an ATM withdrawal, send payment to cover all outstanding transactions, including purchases (ie the difference between your credit limit and your available balance)*.

    *some might argue that technically you are putting the account into credit (I disagree) and of course the actual amount posted can vary slightly. But bear in mind that even if more is eventually posted, interest on this would be tiny. Eg if 2 more is billed, interest would be less than 3p in a month.

    I always pay off the entire balance (inc purchases) asap after an ATM transaction whether or not it has posted. But I don't panic if I can't do this for a few days.
    Last edited by chattychappy; 17-05-2018 at 10:03 AM.
    • Vortigern
    • By Vortigern 17th May 18, 10:01 AM
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    Vortigern
    I had a statement balance of 10 for March. Even if that was paid off first, the balance from my payments 146.50 (156.50 - 10.00) should be allocated to cash transaction, no?
    Originally posted by OceanSound
    Your payment goes first to the 10 from the March statement, then to current month transactions that are visible online.

    If there were both purchase and cash transaction visible online, then the hierarchy of higher interest first would be applied. Your cash transaction was not visible online at the time you made the payment.

    Lesson learned, didn't cost much. You'll know next time.
    • OceanSound
    • By OceanSound 17th May 18, 1:08 PM
    • 171 Posts
    • 26 Thanks
    OceanSound
    .....Lesson learned, didn't cost much. You'll know next time.
    Originally posted by Vortigern
    I'd rather have learnt the lesson beforehand though!. Did read a lot of the posts on the clarity card on here, like this one:
    Pay online when the cash withdrawal entry hits your account.
    I took 'hits your account' to mean when it appears on pending transactions.
    So checked account online, paid it straightaway. One time (with another credit card which had a higher % interest) I forgot and got stung with much higher interest. So, figured. OK, lesson learnt, from now I pay the cash pull amount straightway, and then this happens.
    If there were both purchase and cash transaction visible online, then the hierarchy of higher interest first would be applied.
    Please see screenprint attached and explanation in post #10
    Purchases and cash transactions both have the same interest rate:
    18.95% for both cash transactions and purchases
    • OceanSound
    • By OceanSound 17th May 18, 1:42 PM
    • 171 Posts
    • 26 Thanks
    OceanSound
    ....You won't normally see them online, though you might do if you choose to view pending transactions...
    Originally posted by chattychappy
    I always view pending transactions especially after a cash pull and take screenprint. This time was no exception. See below:


    Two ways to avoid the problem:
    1) wait for the ATM transaction to post (not merely appear as pending or reducing your available balance); or
    2) after an ATM withdrawal, send payment to cover all outstanding transactions, including purchases (ie the difference between your credit limit and your available balance)*.
    I think I would definitely have avoided the interest if I had done (2). i.e. paid off ATM withdrawal amount + send payment to cover all purchases. Then after the cash transaction is posted, there would just be the difference between ATM pull posted amount and pending transaction amount ( 156.50 - 154.14 = 2.36) to pay after a few days. When I say 'pay' I mean for this specific instance. However, I imagine it could end up as a credit if the exchange rate goes up (pound becomes stronger).

    About (1): I don't know if waiting for transaction to post would have solved it on this occasion. See:

    I had 10 balance from previous month. A 20 transaction on 18 April, then two purchases for 85 and 30 on the same date as the cash pull. They were all posted (entered) on the same date 23 April 2018. Surely, my payments of 154.14 and 2.36 should have gone towards:

    1) Overdue balance from previous month (10.00)
    2) other transactions posted in the order:
    a) cash transactions
    b) purchases
    c) balance transfers and money transfers
    d) default charges (plus any interest or charges incurred as a result of those balances).

    It's not really clear if the payment allocation happens immediately upon payment or when the statement is produced. If immediately, 10 of my 154.14 payment would have gone towards clearing last months balance, then the remainder of 144.14 should have gone towards clearing my cash transaction. This hasn't happened, only 9.82 from my payments of 156.50 has been allocated towards the cash transaction (see: screenprint on post#10)
    • OceanSound
    • By OceanSound 17th May 18, 5:13 PM
    • 171 Posts
    • 26 Thanks
    OceanSound
    Guys,

    You've gone awfully quiet after my last post (You're usually a very vocal lot).

    Apparently, in the old days Credit card companies used to apply repayments to the cheapest debt first. e.g. the debt with the lowest interest rate.

    But that changed in January 2011. See: http://www.theukcardsassociation.org.uk/wm_documents/Good%20news%20for%20credit%20card.pdf

    The same changes happened across the pond (in USA) as well:
    https://www.creditcards.com/credit-card-news/law-bans-credit-card-payment-allocation-trickery-1282.php
    A federal credit card reform law enacted in May 2009 requires that credit card companies must apply your entire payment, minus the required minimum payment amount, to the highest interest rate balance on your card. That requirement takes effect Feb. 22, 2010.
    Yet, as you can see above in post#10 my repayments have been allocated to the purchases (that doesn't attract any interest). Suffice to say Something is rotten in Denmark.
    Last edited by OceanSound; 17-05-2018 at 5:16 PM.
    • eskbanker
    • By eskbanker 17th May 18, 5:42 PM
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    eskbanker
    If you carried a balance forward from your previous statement then you'd presumably have an interest charge applied to the current statement, but I don't see this on your extracts. Is it possible that some of the 1.68 relates to trailing interest, even though it seems to be attributed to cash?
    • Dobbibill
    • By Dobbibill 17th May 18, 5:43 PM
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    Dobbibill
    Hi OceanSound,

    I've tried to put the theory below in a simple term but sometimes writing it down is alot harder than explaining it in a conversation.

    The payment made would be to cover 10 outstanding (this will have been incurring interest as you didn't pay it off in full - this won't be seen yet as it's posted to the following statement). The 20 transaction which had statemented and the remainder would go off the interest accuring in the background to prevent it acurring any longer. (again you won't see this until your following statement but the interest on the 10 & 20 transactions will only be a few days rather than a full statement month).

    The remaining payment should come off the cash transaction. That wasn't enough after taking the above into consideration to completely stop all interest - thus the calculation on interest above would be calculated daily/billed monthly.

    Hope this makes sense.
    I'm a Board Guide on the Energy, Student Money Saving, UK Armed Forces and
    Local Money Saving - Wales boards. I'm a volunteer to help the boards run smoothly, and I can move and merge posts there.
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.


    It's not about being the best -
    It's about being better than you were yesterday.
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