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£3 interest on a postive balance

Discussion in 'General Discussion' started by anything I don't mind, Feb 8, 2016.

  1. anything I don't mind

    PermaBanned

    Joined: Dec 28, 2009

    Posts: 13,054

    Location: london

    So I paid off my credit card on 25th December and it was in 50 pence credit.

    Then on the 02/Jan I was charged £3 interest. Because I thought i had paid off the account i didn't both going in to look at it. I logged in end of January to check my points and it said my account was in areas and I got an email saying that this will be sent to the credit agencies because I missed the payment.

    The only reason I am using it is to try and improve my credit rating, not that its bad just heard its good to use a credit card and pay it off. I called up customer service and explain and they said that i was charged £3 interest on a positive balance because although it is worked out on a daily basis it is a monthly interest. Then on 2nd feb i got charged 60 pence interest on the £2.50 balance. haha. Good I logged as they don't send any statements out by email or post or any notification emails about the interest. They only just sent me an email today saying that my account is in areas and credit agencies have been notified. If i had not logged in and didn't check my email, thinking it was paid off within a year or two it would be up to £100s.
     
  2. aardvark

    Sgarrista

    Joined: Jan 2, 2005

    Posts: 7,929

    Location: leeds

    wait, so you paid it off too early in the month?
     
  3. Glanza

    Capodecina

    Joined: Mar 13, 2007

    Posts: 10,081

    Location: South Yorkshire

    Who's the card with?
     
  4. wez130

    Capodecina

    Joined: Jan 31, 2004

    Posts: 10,907

    Location: Matakana New Zealand

    Set up a direct debit for instances like this. I have a minimum payment DD on mine but pay the balance off on the rare occasions i use mine anyway.
     
  5. dl8860

    Mobster

    Joined: Jul 25, 2010

    Posts: 2,782

    Location: Surrey

    It depends when your statement date is. If your statement date was 24th December, then you will have been a day late on paying, and anything on the card at that point will accrue interest and if you don't meet the minimum payment then that will count as bad debt.

    Don't complain that you were lucky to log in, it is solely your responsibility to ensure that it is paid off at the right time. If you haven't taken the time to set up a direct debit to pay the minimum payment (which is a total no brainer), then you need to be exceptionally careful to pay in time, which it looks like you haven't.

    In the case that you somehow have been erroneously billed and your statement date didn't require payment before 25th December, then I take some of it back.

    But do yourself a favour and set up a direct debit to pay the minimum payment right now
     
  6. Syla5

    Soldato

    Joined: Feb 13, 2012

    Posts: 5,097

    Trailing interest. Credit cards apply interest in the month after the period of interest.

    A debt balance for December will still have accrued an interest charge up until the day you paid it off at the end of December. That interest charge will then be applied to your account on your next statement date, and will be due for payment as part of your next bill.

    Lesson learned, always set up a DD for minimum payment, its not worth the hassle of missing a payment due to forgetting about unapplied interest.
     
  7. PlumpMonkey

    Hitman

    Joined: Jul 7, 2009

    Posts: 509

    Location: Bristol, UK

    I have a DD setup to auto pay my full balance when its due but I ran afoul of this kind of thing a few years back. I had used my credit card to get some foreign exchange money. This is billed differently for interest compared to regular purchases.

    Regular purchases incur no interest if you pay the entire balance all off on your payment due date, but the above transaction is classed as a money loan and charged interest from the date of the transaction.

    The kicker was that I really struggled to get this ongoing interest charge off my card. There are 3 elements to this;

    Transaction date
    Statement date
    Payment date

    Normally as long as you pay your entire balance on your payment date everything is fine and you don't get charged any interest. But as I had incurred interest from the transaction date onwards for this one payment, I paid the statement sum on the payment date. But I had also incurred interest between the statement date and payment date, so this doesnt get taken out via the DD sol rolls over to the next month. At which point you repeat the above saga.

    The only way I could clear this was to make an additional payment mid-month to cover any outstanding interest and put the card into positive credit.

    I have learnt my lesson and never use a credit card for money advances again!
     
  8. Semple

    Soldato

    Joined: Mar 5, 2010

    Posts: 5,815

    Who's your card with? I've never been charged interest for having an "in-credit" balance.

    Perhaps i'm the only one getting confused with your statement, but your first line mentions paying off your balance and your account is sat £0.50 in credit. Of which you have then somehow incurred interest wiping out your positive balance and putting you into a negative balance.

    The only thing i can think of, you'd made another purchase after clearing the balance, which wasn't then cleared off at your next statement.
     
  9. wingman

    Mobster

    Joined: Dec 27, 2011

    Posts: 4,762

    How many areas has your account been in? :eek:
     
  10. cheesyboy

    Capodecina

    Joined: Dec 7, 2012

    Posts: 12,068

    Location: Gloucestershire

    He cleared his balance with a small overpayment, then the monthly interest was applied for the balance he'd just paid off. That made the card overdrawn again, then he missed the minimum payment deadline on that balance.
     
  11. Sirrel Squirrel

    Sgarrista

    Joined: Aug 5, 2003

    Posts: 7,705

    Location: Essex

    Contact the card company, they'll probably sort it out. I've done something similar with Nationwide and they sorted it.