Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@. Skimlinks & other affiliated links are turned on

Search
  • FIRST POST
    • ExeCuteUK
    • By ExeCuteUK 10th Jan 19, 12:44 PM
    • 2Posts
    • 0Thanks
    ExeCuteUK
    Charged interest on paid balance?
    • #1
    • 10th Jan 19, 12:44 PM
    Charged interest on paid balance? 10th Jan 19 at 12:44 PM
    Hi,

    Im with Virgin Atlantic credit cards. Account begin December 6th.

    I paid 1950 off 2 weeks before first statment date at beginning of january which left me 30 short of paying in full.

    Ive been charged 27 interest on this first month and I dont understand why ?

    Any help would be appreciated as I assumed no interest is payable on cleared balance.

    Ive been on the phone for an hour to Virgin and they wont tell me how this has been calculated.

    Thanks
Page 1
    • Dobbibill
    • By Dobbibill 10th Jan 19, 12:46 PM
    • 3,590 Posts
    • 4,764 Thanks
    Dobbibill
    • #2
    • 10th Jan 19, 12:46 PM
    • #2
    • 10th Jan 19, 12:46 PM
    Because you haven't paid in full.



    You only get an interest free grace period if your balance is paid in full.
    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.
    • ExeCuteUK
    • By ExeCuteUK 10th Jan 19, 12:49 PM
    • 2 Posts
    • 0 Thanks
    ExeCuteUK
    • #3
    • 10th Jan 19, 12:49 PM
    • #3
    • 10th Jan 19, 12:49 PM
    Thanks for the quick reply!

    The 30 was a mistake as it wasn't expected on the bill, but I was always under the assumption interest is only paid on the outstanding balance ? I guess I have been wrong !!
    • Dobbibill
    • By Dobbibill 10th Jan 19, 2:24 PM
    • 3,590 Posts
    • 4,764 Thanks
    Dobbibill
    • #4
    • 10th Jan 19, 2:24 PM
    • #4
    • 10th Jan 19, 2:24 PM
    Interest is calculated daily on the balance and billed monthly.

    It may be a good idea to set up a DD to pay in full each month so it doesn't happen in the future. It's a shame to incur so much interest on a relatively small balance left.

    Brutal way to learn but hopefully it will just be a one off for you.

    If you do go down the DD route make sure you check the date the first one will kick in - it's not always set up in time for the next statement so that may need to be a manual payment.
    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.
    • Terry Towelling
    • By Terry Towelling 10th Jan 19, 2:44 PM
    • 1,030 Posts
    • 845 Thanks
    Terry Towelling
    • #5
    • 10th Jan 19, 2:44 PM
    • #5
    • 10th Jan 19, 2:44 PM
    Just on the subject of clearing the balance in full to avoid interest, there are some exceptions.

    Barclaycard for example makes a distinction between what it calls your 'main balance' and any 'promotional balances' (such as balance transfers and instalment plans). So, if you have a 0% BT outstanding on your account but also use the card for spending, then as long as you clear your new spending (your 'main balance') each month you will not be charged interest on that spending despite the fact that you are carrying a balance (in the form of a BT) to the next statement.

    Only words of caution here (for BT customers) are don't pay any new spending until it has appeared on a statement and check that your CC provider treats promotional balances the same way as Barclaycard does.

    I must admit, I thought they all had to do this following the hoo haa of a few years back when all CC providers diverted payments to the 0% BT element first in order to guarantee you incurred interest on your new spending. Sadly, from my limited checking of CC T&Cs, it seems they can still charge you interest on your new spending (even if you clear it) as long as they channel your payments to the 'higher interest' parts of the balance first.
    • Ben8282
    • By Ben8282 13th Jan 19, 2:23 AM
    • 2,640 Posts
    • 1,252 Thanks
    Ben8282
    • #6
    • 13th Jan 19, 2:23 AM
    • #6
    • 13th Jan 19, 2:23 AM
    What you are claiming makes NO SENSE if it was a purchase transaction.
    You say the account began 6th December and that you repaid 1950 two weeks before the first statement date at the beginning of January (ie the 1950 had not yet appeared on a statement when you paid it) leaving a balance of 30, which was presumably the balance of the first statement.
    Why did you choose to repay this amount before it had appeared on a statement?
    You should not have been charged interest on purchases on the FIRST statement as you have ot previously had a statement to pay.
    Was the 1950 that you repaid in respect of a cash advance or cash transaction?
    Last edited by Ben8282; 13-01-2019 at 2:27 AM.
    • Craig1981
    • By Craig1981 13th Jan 19, 7:14 AM
    • 716 Posts
    • 366 Thanks
    Craig1981
    • #7
    • 13th Jan 19, 7:14 AM
    • #7
    • 13th Jan 19, 7:14 AM
    agreed with Ben - seems like you have either withdrawn cash, used as a cash transaction (gambling sites etc) or paid off a finance agreement (yes, some card do class this as a cash transaction)

    could it be that the payment is yet to show on your account, and what you are reading is "estimated" interest for next month if not paid off in full?
    • dealer wins
    • By dealer wins 13th Jan 19, 10:13 AM
    • 6,298 Posts
    • 12,507 Thanks
    dealer wins
    • #8
    • 13th Jan 19, 10:13 AM
    • #8
    • 13th Jan 19, 10:13 AM
    Ignore Rockeye hes a post building spammer lol
    Choose life
    • SuperHan
    • By SuperHan 13th Jan 19, 1:13 PM
    • 2,148 Posts
    • 1,296 Thanks
    SuperHan
    • #9
    • 13th Jan 19, 1:13 PM
    • #9
    • 13th Jan 19, 1:13 PM
    What you are claiming makes NO SENSE if it was a purchase transaction.
    You say the account began 6th December and that you repaid 1950 two weeks before the first statement date at the beginning of January (ie the 1950 had not yet appeared on a statement when you paid it) leaving a balance of 30, which was presumably the balance of the first statement.
    Why did you choose to repay this amount before it had appeared on a statement?
    You should not have been charged interest on purchases on the FIRST statement as you have ot previously had a statement to pay.
    Was the 1950 that you repaid in respect of a cash advance or cash transaction?
    Originally posted by Ben8282

    If you don't pay your statement in full aren't you charged interest from the date of purchase until the payment date? So the 1950 would have accrued interest between the purchase date and payment date unless the next statement was paid in full.
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

779Posts Today

6,566Users online

Martin's Twitter