topic Re: When does CC interest start accruing? in Credit Cards

When does CC interest start accruing?

McNugget — Wed, 13 Mar 2019 13:41:13 GMT

My February cc statement was $0. I charged a small amount in the following weeks, so March statement had a balance.

When does interest start accruing? Payment is due 04/06. Do I need to PIF before charging anything else to avoid trailing interest?

I'm so confused.

Note: I have already paid the bill in full. Just trying to figure out how this all work.

Re: When does CC interest start accruing?

Anonymous — Wed, 13 Mar 2019 14:02:26 GMT

There is a grace period minimum of 25 days where new purchases don’t accrue interest on most cards (only subprime cards tend to sometimes have no grace period). Check your card terms.

Basically as long as you pay the statement balance every month, you will never pay interest.

Re: When does CC interest start accruing?

Remedios — Wed, 13 Mar 2019 15:26:18 GMT

@McNugget wrote:
My February cc statement was $0. I charged a small amount in the following weeks, so March statement had a balance.

When does interest start accruing? Payment is due 04/06. Do I need to PIF before charging anything else to avoid trailing interest?

I'm so confused.

Note: I have already paid the bill in full. Just trying to figure out how this all work.

Had you not paid in full, the interest on remaining balance would start accruing on 04/07.

You dont need to PIF before new charges, you only need to pay entire statement balance by the due date. New charges will be included in the next statement period.

Re: When does CC interest start accruing?

GApeachy — Wed, 13 Mar 2019 15:30:38 GMT

@Remedios wrote:
@McNugget wrote:
My February cc statement was $0. I charged a small amount in the following weeks, so March statement had a balance.

When does interest start accruing? Payment is due 04/06.  Do I need to PIF before charging anything else to avoid trailing interest?

I'm so confused.

Note: I have already paid the bill in full. Just trying to figure out how this all work.

Had you not paid in full, the interest on remaining balance would start accruing on 04/07.
You dont need to PIF before new charges, you only need to pay entire statement balance by the due date. New charges will be included in the next statement period.

Do the ccc report the balance on the stmt or the balance at that moment? Trying to do Azeo

Re: When does CC interest start accruing?

GApeachy — Wed, 13 Mar 2019 15:33:30 GMT

@McNugget wrote:
My February cc statement was $0. I charged a small amount in the following weeks, so March statement had a balance.

When does interest start accruing? Payment is due 04/06. Do I need to PIF before charging anything else to avoid trailing interest?

I'm so confused.

Note: I have already paid the bill in full. Just trying to figure out how this all work.

I'm so glad you asked this, I was pif several times cuz I wasn't sure either.

Re: When does CC interest start accruing?

McNugget — Wed, 13 Mar 2019 15:36:26 GMT

@Remedios wrote:
@McNugget wrote:
My February cc statement was $0. I charged a small amount in the following weeks, so March statement had a balance.

When does interest start accruing? Payment is due 04/06.  Do I need to PIF before charging anything else to avoid trailing interest?

I'm so confused.

Note: I have already paid the bill in full. Just trying to figure out how this all work.

Had you not paid in full, the interest on remaining balance would start accruing on 04/07.
You dont need to PIF before new charges, you only need to pay entire statement balance by the due date. New charges will be included in the next statement period.

Perfect! Thank you!

Re: When does CC interest start accruing?

Remedios — Wed, 13 Mar 2019 15:39:33 GMT

@GApeachy wrote:
@Remedios wrote:
@McNugget wrote:
My February cc statement was $0. I charged a small amount in the following weeks, so March statement had a balance.

When does interest start accruing? Payment is due 04/06.  Do I need to PIF before charging anything else to avoid trailing interest?

I'm so confused.

Note: I have already paid the bill in full. Just trying to figure out how this all work.

Had you not paid in full, the interest on remaining balance would start accruing on 04/07.
You dont need to PIF before new charges, you only need to pay entire statement balance by the due date. New charges will be included in the next statement period.

Do the ccc report the balance on the stmt or the balance at that moment? Trying to do Azeo

Most report statement balance at closing. US Bank reports last day of the month, regardless of statement day. Chase reports statement balance, plus any time account is brought down to $0.00

Re: When does CC interest start accruing?

Anonymous — Thu, 14 Mar 2019 06:03:41 GMT

That’s been my experience

Re: When does CC interest start accruing?

UpperNwGuy — Thu, 14 Mar 2019 11:03:13 GMT

But if you don’t pay the statement balance in full, you might (depending on your card) trigger “trailing interest.” Google that phrase to learn more.

Re: When does CC interest start accruing?

Anonymous — Thu, 14 Mar 2019 14:06:08 GMT

One way to think about it (for most cards anyway) is

1) Interest accrues from the day the purchase posts (most issuers use average daily balance)

2) BUT: if you PIF before due date, the accrued interest is waived.

This accounts for trailing interest etc, the interest is always potentially there, just waived if you meet the terms, and not otherwise.

Re: When does CC interest start accruing?

GApeachy — Thu, 14 Mar 2019 14:59:50 GMT

thanks also

Re: When does CC interest start accruing?

Anonymous — Thu, 14 Mar 2019 15:12:54 GMT

I don’t know why they are making it so complicated, I even got myself confused in this thread.

Heres how it works. If you had a $0 balance when the cycle started and you throw charges on the card, you will not begin to be charged interest on those purchases until you receive a statement above $0 and don’t pay it in full. Once you have a statement that has a balance and you don’t pay that statement balance, you will be assessed interest on your next statement.

Situation A: Your card has a $0 balance and you throw $500 on it and your statement balance is $500. If you pay $500, you will not be charged interest.

Situation B: Your card has a $500 balance and you receive a statement that says you owe $100 because $400 of charges were still pending when the statement was generated. If you pay $100, you will not be charged interest and the $400 will be added to your next statement balance.

Situation C: You pay the $100 statement balance in situation B and add another $200 in charges that month. Your balance brought forward from the last month is $400 and your charges from this month are added to that, giving you a statement balance of $600. You must pay this in full or you will get assessed interest on the balance.

Situation C is where people start to get in trouble with credit cards if they aren’t tracking how much they charged before the statement was issued in situation B and thus fall short when the get the $600 bill. It’s very easy to fall behind when the interest starts compounding and that’s why you will see quite a few on here say they pay multiple times a month so that they know they don’t have any charges beyond what they can pay or they don’t have that time where they didn’t actually realize they had pending charges when the statement is issued and thus fall short when the next statement comes.

I personally tend to pay my current balance listed online when I pay my credit cards, not my statement balance, that way I know my card gets zeroed out every month and I never have any surprises. If you pay the current balance and take note of any pending charges, you will never have to worry about paying interest.*

*There are other ways you can still be responsible for interest charges so check your card terms. Cash advances and balance transfers usually begin incurring interest when they post as the grace period only applies to purchases. Further complications happen when you have different types of balances on a card. A lot of cards lose their grace period if you have a balance transfer on them which means when you put new charges on the card, you will get assessed interest on new charges from the date they post unless you pay the entire balance, BT and all, to zero.

Re: When does CC interest start accruing?

Remedios — Thu, 14 Mar 2019 15:09:55 GMT

It's not complicated. Go to Pay, pick statement amount option. Done. No interest.

Or whatever @Anonymous said.

Re: When does CC interest start accruing?

FinStar — Thu, 14 Mar 2019 15:54:56 GMT

@Remedios wrote:
It's not complicated. Go to Pay, pick statement amount option. Done. No interest.

Or whatever @Anonymous said.

This ^^^^.