04-20-2009 06:13 PM
Has anyone gotten a CC to apply a payment or an extra payment to a std purchase balance before a promotional offer?
I have a Citi card with BAL OF $23,000 at 5.99% for life, which yeilds them about $104.00 in interest each month. I had a promo that recently expired from 0% to 18.99% on a balance of about $3,600. This costs me a whopping $55.00 in interest per month.
So... Each payment goes toward the 5.99% before the 18.99%. Due to the high balance on the promo the $3,600 is just going to sit there and make them tons of money for a very long time.
Has anyone had any luck geting them to apply a payment to the high interest portion first? I even offered to pay the whole $3,600.00 and they said they could not do it.
Should I threaten to not pay? Ask to go on a plan?
04-20-2009 06:42 PM
Read you credit agreement. Every single one I have ever seen states either: 1) payments will be applied to the balances carrying the lowest APR's first, or 2) the issuer can apply payments to whichever balances they feel like first. Unless yours says something different (which, by the way, the issuer could have arbitrarily changed at any time since you opened the account) you're stuck. Suffice to say that this is a significant enough amount of money that Citi (or anyone who buys this debt from Citi if it is CO'ed and sold) will use every legal tool at their disposal to collect it.
If you don't make timely payments of at least the minimum amount they will move this account to the default rate. You will like that rate even less.
So until and unless the federal government enacts a new law stating that issuers have to apply payments in a manor that is more beneficial to you I am afraid you are stuck. That's not impossible. There has been pending legislation in Congress for years that will do just that. We all keep waiting.
Are you saying you cannot pay this or that you don't feel like paying? Makes a huge difference. If it is impossible for you to pay this debt then you need to post back stating that so someone can give you the appropriate help.
Best of luck!
04-21-2009 04:16 AM
Thanks for your response. To answer your question, I'm finding it increasingly difficult to pay on my cc debt due to the increase in APR's Although I can still pay, I'm looking for ways to reduce the APR so I can have more of my payment go to the principle. Do I explain to them that I'm having a tough time and maybe in the future I won't be able to pay? I want to fulfill my obligation on my payment but they are putting me at risk by locking me in to this higher APR that won't get touched for some time until I pay off the huge chunk of debt at the 5.99 rate.
Thanks and any thoughts are appreciated!
04-21-2009 04:58 AM
The majority of the time, you will not have any success, however, I once spoke with the CSR's at Best Buy CC and they said if I called and asked them to, they would apply the payment to whichever promotional plan I wanted them to.
You could call and ask Citi to do that. It can't hurt, the worst they'll say is no.
Adddtionally, your only other recourse may be to attempt to BT the entire balance to another card.
04-21-2009 07:32 AM
When you consider the total interest charged on the total amount owed, it is very reasonable. It is well under 10%. As you pay it down the interest will become higher but on a lower balance.
How about paying it down as fast as you can and then after making some payments, ask for an interest rate reduction on the account. This would lower the 18.99% balance.
A BT to another card is also good advice if you can get a decent deal. I would imagine that you will find it hard to beat your current deal with the BT fees included.
A perfect example of why you don't mix promotional deals on a CC.
You didn't expect them to be happy with either the 0% or the 5.99% on a permanent basis, did you?
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