Grace period clarification

[Anonymous]

I think I understand how this works now after some confusion (keep in mind I'm still rather new to regularly using credit cards for daily purchases), so please let me know if I've got this correct or not. Thanks!

My credit card has a statement date of the 22nd of every month and a due date of the 19th of every month. If I am understanding grace periods correctly, then a charge made on June 1 is fully processed on June 2 and included in the statement for June 22, and therefore not actually due to be paid until July 19. Likewise, charges that occur and are fully processed (not pending) by June 22 will all collectively be due to be paid on July 19. All charges processed after June 22 and by July 22 will therefore be on the following statement and thus due on August 19. No interest would be assessed for any of these charges as long as they were correctly paid in full on the due date for the statement of which they were a part.

Now, if I paid at least the minimum but less than the total due on July 19, then any remaining balance - in addition to all new charges - would be subject to interest on the July 22 statement / August 19 payment AND August 22 statement / September 19 payment until such time as I paid the full statement balance 2 months in a row or otherwise paid the total balance of the card down to zero.

All of which means that the grace period for which no interest is charged on a purchase varies from time of purchase to time of payment for purchase between 25-55 days depending on what day of month the item was purchased, provided statements continue to be paid in full. 

If statements are not paid in full, then all purchases are immediately subject to interest accumulation based on average daily balance of card during statement period UNTIL 2 consecutive statement balances are paid in full. At that point, interest stops accumulating on average daily balance and 25-55 day grace period is re-established.

Does all that sound right? I ask because in card terms and conditions, grace period is listed as 25 days from purchase, and the way I understand it, the ACTUAL grace period is AT LEAST 25 days and typically much longer between time of charge and time of required payment of charge to prevent interest accumulation. But I want to make sure I have that correct.

[Chris679]

Some cards may vary slightly and you should always read the cardholder agreement but you are right on the money.

[Anonymous]

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@Chris679 wrote:
Some cards may vary slightly and you should always read the cardholder agreement but you are right on the money.

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Thank you! When I first got my Chase Amazon card 8 years ago, their notifications seemed like they were designed to set me up to miss payments and get charged interest and/or late fees, so now that I'm trying to live a credit-active life, it's important for that to never happen again.

[Anonymous]

If account that previously had zero balance you can pay the minimum and then pay even more a day or two after and still avoid Interest because of statement cut dwte. that is the "norman" way of paying down debt. As long as you hit it before the statement cut it is all the same.

You just need to go online and check every statement and see how many days in billing cycle. That will give you a good idea of where everything lands

[RonM21]

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@Chris679 wrote:
Some cards may vary slightly and you should always read the cardholder agreement but you are right on the money.

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+1

Absolutely!

[takeshi74]

I understand all the dates for the examples but the order of events is basically like this:

Statement Cycle Start

Statement Cycle Close (card that report on statement date report at this time)

Grace Period (if applicable)

Payment Due Date

A payment has to post to be included in the given cycle.  The grace period is the time between statement close and payment due date but, yes, specific purchases can be interest free for longer than the grace period given that they can fall anywhere within the given statement cycle.  Generally, if you carry a balance your new purchases immediately begin accruing interst and you lose your grace period.  If you do carry it can take 2 payments in full to address the residual interest.