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How is minimum payment calculated?

Blogger

How is minimum payment calculated?

I have one card with a 1.7k balance  and $30 minimum payment, and another card with an $80 balance and $40 minimum payment.Man Surprised  Am I missing something? Smiley Frustrated

Message 1 of 9
8 REPLIES
Senior Contributor

Re: How is minimum payment calculated?

Each creditor calculates the min pmts differently. Is the $80 bal on a gas card?
Typically, higher interest rates cause min pmts to increase. Most issues do the higher of 1% of the bal + interest + late fees OR $25 lol
Marriott PR$25k | BCE $24.5K |BankAmericard Visa $25k| BOA Better Bal $17.5k |Wmt Discover $12.5k | BR Visa $17.5k | Amex Delta Gold $10k | Discover IT $10k | Paypal Extras MC $15k | Amazon Store $10k|Smile Gen $7.25k | Dillard's $10k | West Elm $4k| Express $3.05K | Mypoints.com Visa $4.5k | Freedom Visa $1k| Amex Surpass $1k
Message 2 of 9
Valued Contributor

Re: How is minimum payment calculated?

not sure. ive never had a balnce of more then 2700 dollars but my payments have never been more then 30 a month. 

 

ive seen other peoples though where they have about 8k in debt and their payments were around 140+

Current: Discover Fico 709 3/15 Walmart Fico 743 4/15

Inquiries (24 Months): EQ 6 TU 1 EX 6 | Most Recent: 4/09/2015
Over 12 Months:9


2015 Goals:
Lower Utility
Earn Cash Back

Amex Zync(Unicorn)
Chase Freedom$1500
Discover IT$7,400
Citi DC $10,000
Citizens Mastercard$7,000
Message 3 of 9
Valued Contributor

Re: How is minimum payment calculated?

I don't believe minimum payment is "calculated" per se, unless you reach a certain high balance. Most minimum payments are $25, though my TD Bank card has one at $35, given that my balance is at or more than that set minimum amount. Otherwise, the minimum payment is your statement balance. At one point I had a relatively high balance on my JCP account (maybe around $500? $600?) where they must have deemed me as a risk and sent a slightly higher $29 payment my way. I always PIF anyways so minimum payments mean little to me. Try reading through the terms and conditions, they may give a method to calculating the minimum payment, but most just state the minimum values. Best of luck!


Quicksilver WMC $20k | JCPenney Platinum $10k | Drive for Five $800 | Freedom VS $5k | TD Cash VS $5k | CFU VS $14.8k | Blue Sky $13.7k | IT $28k | SavingStar $14.8k | BCE $11.3k | Macy's AMEX $7.2k | BuyPower WEMC $7.5k | CSR VI $13.3k | Diamond Preferred $6.5k FICOS: EX 775 EQ 764 TU 759 VantageScore 3.0: EX 759 EQ 757 TU 762
Message 4 of 9
Established Contributor

Re: How is minimum payment calculated?

Depends on who it is, Chase is $25 or (1% of total balance) + (fees + interest + overlimit amount), whichever is greater.. USAA is same but $30 instead of $25

Message 5 of 9
Blogger

Re: How is minimum payment calculated?


youngandcreditwrthy wrote:
Each creditor calculates the min pmts differently. Is the $80 bal on a gas card?
Typically, higher interest rates cause min pmts to increase. Most issues do the higher of 1% of the bal + interest + late fees OR $25 lol

Both cards are regular, i.e. non-store, non-gas, non-secured, cards, and carry a 0% promotional APR. And I am never late on payments.

Message 6 of 9
Senior Contributor

Re: How is minimum payment calculated?

+1. Amex has a min pmt of $35 too and Discover adds like $40 to your min pmt if you have a bt.
Marriott PR$25k | BCE $24.5K |BankAmericard Visa $25k| BOA Better Bal $17.5k |Wmt Discover $12.5k | BR Visa $17.5k | Amex Delta Gold $10k | Discover IT $10k | Paypal Extras MC $15k | Amazon Store $10k|Smile Gen $7.25k | Dillard's $10k | West Elm $4k| Express $3.05K | Mypoints.com Visa $4.5k | Freedom Visa $1k| Amex Surpass $1k
Message 7 of 9
Blogger

Re: How is minimum payment calculated?

It seems to be the consensus that each lender has a different way of calculating minimum payments, but is there a general principle? For example, the maximum number of years it should take to pay off the balance must be under X, or the amount of interest paid must be smaller than Y% of the principal?

Message 8 of 9
Frequent Contributor

Re: How is minimum payment calculated?


youngandcreditwrthy wrote:
+1. Amex has a min pmt of $35 too and Discover adds like $40 to your min pmt if you have a bt.

This is all true. Minimums are not kind on either of these creditors cards

Message 9 of 9