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  • FIRST POST
    • Curls2208
    • By Curls2208 4th Nov 17, 10:49 AM
    • 50Posts
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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 2
    • Fuzzboxo
    • By Fuzzboxo 17th May 18, 5:43 PM
    • 2 Posts
    • 4 Thanks
    Fuzzboxo
    You've actually posted exactly why the interest has been added - neither the cash transaction nor the purchases had fully posted to the account when you made the manual payment, so it didn't have any debit balance to allocate to.

    The payment went on immediately on the 20th April, but the cash and purchase transactions didn't fully post until 23rd April. This is the point at which you should make the payment to clear the interest-accruing cash balance (plus you'd know exactly how much it was too).

    I'd never try and pay off a pending transaction, even if I personally know it's going through, because the bank(s) don't, and that's why they can't allocate payments to it. Essentially you put your card into credit by 124.14, so when the cash and purchase transactions end up debiting, they likely just debit in processing order (which could well be different from the order in which you actually made them). You'd also probably have a very hard time convincing Halifax to change their systems to debit payments in "highest interest first" order too, since deliberately leaving a credit balance on the account is almost certainly a breach of the T&Cs.
    • OceanSound
    • By OceanSound 17th May 18, 6:19 PM
    • 362 Posts
    • 57 Thanks
    OceanSound
    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?
    Originally posted by eskbanker
    Opened account in April. The first ever transaction was a 10 purchase transaction done on 10 April. Statement date 16 April 2018 says I had to pay minimum 5 by 11 May 2018. And it says 'Next months estimated interest 0.16'. Presumably that's if I had paid the minimum payment. Anyway there is no doubt that my payments had covered this purchase before covering anything else. Correct?
    • eskbanker
    • By eskbanker 17th May 18, 6:30 PM
    • 7,994 Posts
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    eskbanker
    Opened account in April. The first ever transaction was a 10 purchase transaction done on 10 April.
    Originally posted by OceanSound
    ....in which case your earlier post is rather misleading!
    I had a statement balance of 10 for March.
    Originally posted by OceanSound
    (as is their reference to 'balance from previous statement')
    • OceanSound
    • By OceanSound 17th May 18, 6:40 PM
    • 362 Posts
    • 57 Thanks
    OceanSound
    ....You'd also probably have a very hard time convincing Halifax to change their systems to debit payments in "highest interest first" order too,.....
    Originally posted by Fuzzboxo
    No idea who put you up to leaving this as your first post. However, it's not up to me to convince Halifax. It's up to them to abide by the rules. 'highest interest first' is the practice all credit card companies must abide by.
    • Fuzzboxo
    • By Fuzzboxo 17th May 18, 7:00 PM
    • 2 Posts
    • 4 Thanks
    Fuzzboxo
    No idea who put you up to leaving this as your first post. However, it's not up to me to convince Halifax. It's up to them to abide by the rules. 'highest interest first' is the practice all credit card companies must abide by.
    Originally posted by OceanSound
    There was a minimal balance on your card when you made the payment, the 124.14 extra put you in credit. The cash and purchases were still pending and hadn't yet posted to the account. Had you waited until the 23rd April to make the payment, you wouldn't have ended up in the situation you now find yourself in.

    No-one "put me up" to post anything, if you think I've an ulterior motive somewhere that honestly says more about you than about me.
    • zagfles
    • By zagfles 17th May 18, 7:29 PM
    • 13,320 Posts
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    zagfles
    I always view pending transactions especially after a cash pull and take screenprint. This time was no exception. See below:



    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)
    Originally posted by OceanSound
    Payment allocation should happen immediately. The point is that there was nothing to allocate most of your payment to, since it was posted on the 20th before your cash withdrawal was posted on the 23rd. So it created a credit balance, which was mopped up by the transactions on the 23rd. It seems the purchases were posted before the cash withdrawal, so these mopped up the credit balance first.

    So:
    • Statement of 10
    • Purchase of 20 (19th April)
    • Payment of 154.14 (20th)
      • This would have paid off the 30 balance, leaving a credit of 124.14
    • Purchase of 85 (23rd)
    • Purchase of 30 (23rd)
      • Balance now credit of 9.14
    • Cash withdrawal of 156.50 (23rd)
      • Leaving balance of 147.36 of cash advance, so accruing interest
    • Purchase of 5.41 (30th)
      • Balance now 147.36 cash and 5.41 purchases
    • Payment of 2.36 (8th May)
      • Allocated to cash as per rules, as you now have a cash balance. Balance now 145 cash and 5.41 purchases
    • Statement on 16th May:
      • Interest calculated on cash: (147.36 x 15 + 145 x 9) x 0.01456*12/365 = 1.68
      • Balance now 146.68 cash (with interest added) and 5.41 purchases
    So you need to make a payment of 146.68 asap and that will clear the cash, and you'll pay 7p interest a day until you pay it.
    • chattychappy
    • By chattychappy 18th May 18, 9:52 AM
    • 6,897 Posts
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    chattychappy
    You've gone awfully quiet after my last post (You're usually a very vocal lot).
    Originally posted by OceanSound
    Because between 1.42pm and 5.13pm I was doing a day job, perhaps other posters had other things to do also (or even other threads to engage in)? The gist of your enquiry had been answered even if the detail hadn't been drilled down.
    • pochisoldi
    • By pochisoldi 18th May 18, 10:40 AM
    • 136 Posts
    • 81 Thanks
    pochisoldi
    How to cheaply withdraw cash on a Halifax Clarity card
    Before we start
    1) Do not pay off a cash withdrawal until it actually debits your account. (aka do not pay off a pending transaction)
    2) It's cheaper to withdraw cash Sunday-Thursday. Otherwise it takes longer for the account to be debited, and you pay more interest while you are waiting.

    Paying it off
    1) Wait until the Halifax mobile app/website tells you that the cash withdrawal has actually been debited.
    2) Make the payment. This should be for
    a) The previous month's balance plus the cost of the cash withdrawal (if you haven't already paid off the card)
    b) the cost of the cash withdrawal, (if you've already paid off last month's
    balance)

    I've used this method since day 1 (back in 2011), and I have never had more than pennies worth of interest* on the statement with the cash withdrawal, and no further interest after that, and I retained the interest free period on all card purchases.

    The only time you can definitely get away with paying off a cash withdrawal before it debits is if you have a zero balance on the card, AND you have no pending card purchases.

    PochiSoldi

    * Still cheaper than any other method of obtaining foreign cash.
    Last edited by pochisoldi; 18-05-2018 at 10:44 AM.
    • OceanSound
    • By OceanSound 18th May 18, 1:50 PM
    • 362 Posts
    • 57 Thanks
    OceanSound
    Because between 1.42pm and 5.13pm I was doing a day job, perhaps other posters had other things to do also (or even other threads to engage in)? The gist of your enquiry had been answered even if the detail hadn't been drilled down.
    Originally posted by chattychappy
    Clearly I've hit a raw nerve.
    perhaps other posters had other things to do also (or even other threads to engage in)?
    Is this the reason for a flurry of replies soon after my message at 4.13pm?
    You can see for yourself. Replies at 4:42pm, 2x mesages at 4:43pm.
    Last edited by OceanSound; 18-05-2018 at 2:17 PM.
    • OceanSound
    • By OceanSound 18th May 18, 1:59 PM
    • 362 Posts
    • 57 Thanks
    OceanSound
    There was a minimal balance on your card when you made the payment, the 124.14 extra put you in credit. The cash and purchases were still pending and hadn't yet posted to the account. Had you waited until the 23rd April to make the payment, you wouldn't have ended up in the situation you now find yourself in.

    No-one "put me up" to post anything, if you think I've an ulterior motive somewhere that honestly says more about you than about me.
    Originally posted by Fuzzboxo
    ...Had you waited until the 23rd April to make the payment, you wouldn't have ended up in the situation you now find yourself in.
    Not buying this. Even if I waited until the 23rd ** the payment would have been allocated to the purchases first as they've were carried earlier on 20 April before the cash transaction.

    I think you mean, Waited until the 23rd, then made a payment to cover the previous statement balance, all the purchases up to 20th and the cash transaction.

    It would be good if there is a breakdown of balance (similar to the one in post#10) through internet banking so the customer can see how his payment(s) are allocated before he/she receives the statement (as it is, this is when he/she become aware of the allocation).

    ** - note that there was nothing on these forums to suggest that we should wait until the cash transaction is posted (as opposed to hitting the account). Only now you guys have started to shout it from the roof tops.
    • OceanSound
    • By OceanSound 18th May 18, 2:10 PM
    • 362 Posts
    • 57 Thanks
    OceanSound
    Payment allocation should happen immediately. The point is that there was nothing to allocate most of your payment to, since it was posted on the 20th before your cash withdrawal was posted on the 23rd. So it created a credit balance, which was mopped up by the transactions on the 23rd. It seems the purchases were posted before the cash withdrawal, so these mopped up the credit balance first.

    So:
    • Statement of 10
    • Purchase of 20 (19th April)
    • Payment of 154.14 (20th)
      • This would have paid off the 30 balance, leaving a credit of 124.14
    • Purchase of 85 (23rd)
    • Purchase of 30 (23rd)
      • Balance now credit of 9.14
    • Cash withdrawal of 156.50 (23rd)
      • Leaving balance of 147.36 of cash advance, so accruing interest
    • Purchase of 5.41 (30th)
      • Balance now 147.36 cash and 5.41 purchases
    • Payment of 2.36 (8th May)
      • Allocated to cash as per rules, as you now have a cash balance. Balance now 145 cash and 5.41 purchases
    • Statement on 16th May:
      • Interest calculated on cash: (147.36 x 15 + 145 x 9) x 0.01456*12/365 = 1.68
      • Balance now 146.68 cash (with interest added) and 5.41 purchases
    So you need to make a payment of 146.68 asap and that will clear the cash, and you'll pay 7p interest a day until you pay it.
    Originally posted by zagfles
    I think your post offers the best explanation. (I'm basing this on content, without looking at the 'likes')
    It seems the purchases were posted before the cash withdrawal, so these mopped up the credit balance first.
    I believe this is because I carried out the two purchases on the morning of 20 April before carrying out the cash withdrawal in the afternoon.

    Otherwise, it would have been a bit sneaky to arbitrarily/randomly post them ahead of the cash transaction.
    So you need to make a payment of 146.68 asap and that will clear the cash, and you'll pay 7p interest a day until you pay it.
    I paid off the full statement balance of 152.09 yesterday through online banking. (It's posted on to the clarity account same day)
    • OceanSound
    • By OceanSound 17th Jun 18, 6:32 AM
    • 362 Posts
    • 57 Thanks
    OceanSound
    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?
    Originally posted by eskbanker
    Received June 2018 statement today. No trailing interest. Presumably this is because I had paid off the full balance immediately?
    On the May 2018 statement it said 'estimated interest = 2.35. Is this the amount of interest I would have paid, if I just paid the minimum payment (which was 5.00).

    Also, could 'trailing interest' apply if I had paid the full balance but at a later time between 16 May 2018 (May 2018 statement issue) and 17 June 2018 (June 2018 statement issue). For example, if I paid off full balance on 10 June 2018.
    • zagfles
    • By zagfles 17th Jun 18, 8:46 AM
    • 13,320 Posts
    • 11,299 Thanks
    zagfles
    Received June 2018 statement today. No trailing interest. Presumably this is because I had paid off the full balance immediately?
    Originally posted by OceanSound
    Yes
    On the May 2018 statement it said 'estimated interest = 2.35. Is this the amount of interest I would have paid, if I just paid the minimum payment (which was 5.00).
    Probably. I always ignore the estimated interest as it's based on some assumption or other.
    Also, could 'trailing interest' apply if I had paid the full balance but at a later time between 16 May 2018 (May 2018 statement issue) and 17 June 2018 (June 2018 statement issue). For example, if I paid off full balance on 10 June 2018.
    Yes, like I said above it would have been 7p a day. Also it's possible that you'd have been charged a few p interest the following month, since the interest charged this month would start accruing interest from the statement date. But this would only have been a few p at most.
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