topic Re: Are there any cards left that don't charge residual interest? in Credit Cards

Are there any cards left that don't charge residual interest?

UpperNwGuy — Thu, 17 Feb 2022 11:41:03 GMT

Back in the dark ages when I used to carry balances from month to month, I noticed that some credit cards charged residual interest (or trailing interest) when you thought you were paying off a revolving balance in full. Some lenders charged it and that others did not, but that was a decade ago. I was in a discussion with some folk recently, and they told me that residual interest is now standard practice by all lenders. That made me think that perhaps my knowledge is out of date (as it has been seven years since I carried a balance). My question to the board is the following: Are there any cards left (perhaps credit union cards?) that don't charge residual interest, or is it now a uniform practice?

Re: Are there any cards left that don't charge residual interest?

NRB525 — Thu, 17 Feb 2022 11:57:47 GMT

My Capital One cards didn't charge interest the first month or the last month. I did a series of $500 no-fee BT's to the QS, because the interest rate was like 10% fixed. Transfer in one month, no interest, arrange payment of $200 or so. Next cycle, interest charged on the remainder, arrange another $200. Third cycle interest charged, arrange payment on that remaining statement balance, and final statement would be zero.

This was up to early 2020, so I expect still may be a feature.

Re: Are there any cards left that don't charge residual interest?

CreditMagic7 — Thu, 17 Feb 2022 14:26:45 GMT

After being well over 10 years in this thing we call Credit Cards the single only trailing interest nitwit was Barclays. I would pay in full only to find a small balance again once the statement cut. Now Comenity is exercising that same such practice. I not long ago PIF one of my cards with them, and guess what, after statement cut it showed a single dollar bill $1.00 balance. Already took care of that silliness.

Now on when i roll a balance a month or two, then do the PIF they get overpaid. Hah ha last month i did the same thing and they had to send me a check for the overage. And with them that's how it's going to be for now on. When i PIF i fully intend my payments to COMPLETELY PIF including trailing sneak attacks.

It's the only way to stifle that ignorant affliction their slap happy about. I like to see my PIF statements with the CRA's zero after paying off their bill. And i thought old Barclays was the last one to pull that clown show. (I no longer for years have any Barclays Cards)

Re: Are there any cards left that don't charge residual interest?

SouthernCredit — Thu, 17 Feb 2022 16:27:04 GMT

My USAA card does not have trailing interest.

Re: Are there any cards left that don't charge residual interest?

CreditMagic7 — Thu, 17 Feb 2022 18:57:49 GMT

@SouthernCredit wrote:
My USAA card does not have trailing interest.

I haven't seen any either until Barclay (ages ago) and more recently now Comenity. (I've since initiated a new provision for that potential occurance)

I do roll balances, not much, but is been a worthy practice of mine for many years without one single issue except the above mentioned.

Re: Are there any cards left that don't charge residual interest?

SouthernCredit — Thu, 17 Feb 2022 19:46:12 GMT

@CreditMagic7 wrote:
@SouthernCredit wrote:
My USAA card does not have trailing interest.
I haven't seen any either until Barclay (ages ago) and more recently now Comenity. (I've since initiated a new provision for that potential occurance)
I do roll balances, not much, but is been a worthy practice of mine for many years without one single issue except the above mentioned.

I know for a fact BofA and Citi both do

Re: Are there any cards left that don't charge residual interest?

ChargedUp — Thu, 17 Feb 2022 20:16:19 GMT

@SouthernCredit wrote:
@CreditMagic7 wrote:
@SouthernCredit wrote:
My USAA card does not have trailing interest.
I haven't seen any either until Barclay (ages ago) and more recently now Comenity. (I've since initiated a new provision for that potential occurance)
I do roll balances, not much, but is been a worthy practice of mine for many years without one single issue except the above mentioned.
I know for a fact BofA and Citi both do

I can vouch for BoA doing it as well.

Re: Are there any cards left that don't charge residual interest?

Kforce — Thu, 17 Feb 2022 20:51:20 GMT

@CreditMagic7 wrote:
@SouthernCredit wrote:
My USAA card does not have trailing interest.
I haven't seen any either until Barclay (ages ago) and more recently now Comenity. (I've since initiated a new provision for that potential occurance)
I do roll balances, not much, but is been a worthy practice of mine for many years without one single issue except the above mentioned.

What is doing roll balances ?

Re: Are there any cards left that don't charge residual interest?

CreditFun — Thu, 17 Feb 2022 22:21:00 GMT

Best Buy Visa does not.

Re: Are there any cards left that don't charge residual interest?

FinStar — Thu, 17 Feb 2022 23:52:40 GMT

@CreditFun wrote:

Best Buy Visa does not.

Actually, they do @CreditFun. Not sure if you're getting this mixed up as far as 'residual' interest versus 'deferred' interest. Unless, I misread your response, since the Best Buy Visa will have residual interest as mentioned upthread. My apologies in advance if I misinterpreted your response.

Their CCA agreement states:

https://citiretailservices.citibankonline.com/apply/best-buy-credit-card?langId=EN&siteId=PLCN_BESTBUY&app=UNSOL&sc=BBYPL#tnc

Interest Charges. We impose interest charges when we apply APRs to your account balances. We do this every day by using a daily periodic rate. To get a daily periodic rate, we divide the APR by 365.

When Interest Charges Begin. We begin to impose interest charges the first day we add a charge to a daily balance. The charges we add to a daily balance include purchases, interest charges and fees. We continue to impose interest charges until we credit your account with full payment of the total amount you owe us.

Grace Period on Purchases. You can avoid interest charges on purchases. This is called a grace period on purchases. The grace period is at least 25 days. To get a grace period on purchases, you must pay the New Balance by the payment due date every billing cycle. If you do not, you will not get a grace period until you pay the New Balance for two billing cycles in a row.

If you have a balance subject to a deferred interest promotion and that promotion does not expire before the payment due date, that balance (an “excluded balance”) is excluded from the amount you must pay in full to get a grace period on a purchase balance other than an excluded balance. In addition, if you have a reduced rate credit plan balance, that balance (an “excluded balance”) is excluded from the amount you must pay in full to get a grace period on a purchase balance other than an excluded balance. However, you must still pay any separately required payment on the excluded balance. In billing cycles in which payments are allocated to deferred interest balances first, the deferred interest balance will be reduced before any other balance on the account. However, you will continue to get a grace period on purchases, other than an excluded balance, so long as you pay the New Balance (less any excluded balance, plus any separately required payment on an excluded balance) in full by the payment due date each billing cycle. In addition, certain promotional offers not described above may also allow you to have a grace period on purchases without having to pay all or a portion of the promotional balance by the payment due date. If that is the case, the promotional offer will describe what happens.

Calculation of Interest Charges – Daily Balance Method (Including Current Transactions). We calculate interest charges each billing cycle.

Re: Are there any cards left that don't charge residual interest?

CreditFun — Thu, 17 Feb 2022 23:51:47 GMT

Interesting.

I was carrying a balance. Paid in full before the cycle cut date.

Have an entry on my statement cut yesterday, Interest Charge on Purchases $0.00.

Maybe they make another line in a few days that says residual interest for next months statement? Or a YMMV?

Re: Are there any cards left that don't charge residual interest?

FinStar — Thu, 17 Feb 2022 23:54:03 GMT

@CreditFun wrote:
Interesting.

I was carrying a balance. Paid in full before the cycle cut date.

Have an entry on my statement cut yesterday, Interest Charge on Purchases $0.00.

Maybe they make another line in a few days that says residual interest for next months statement? Or a YMMV?

Any residual interest (if applicable) is shown once the next statement cycle generates.

Re: Are there any cards left that don't charge residual interest?

CreditMagic7 — Fri, 18 Feb 2022 10:31:15 GMT

Paid my comical $1.00 residual and quickly enough reflected a day later by displaying full credit limit again without that balance.

From now on it's simple enough to overpay a few dollars and let them enjoy spending more for processing a paper check on overage plus envelope and postage. It's a bunch of hot air if you ask me but their books will satisfy the zero clearance for them.

Re: Are there any cards left that don't charge residual interest?

805orbust — Fri, 18 Feb 2022 11:42:29 GMT

@CreditMagic7 see this is why the little voice in my head is urging me to pare down my portfolio of cards. Imagine you miss something like this and go 30 days? 120 points gone. Although autopay is your friend even that is not 100% reliable.

Re: Are there any cards left that don't charge residual interest?

CreditMagic7 — Fri, 18 Feb 2022 12:12:45 GMT

@805orbust wrote:
@CreditMagic7 see this is why the little voice in my head is urging me to pare down my portfolio of cards. Imagine you miss something like this and go 30 days? 120 points gone. Although autopay is your friend even that is not 100% reliable.

Its been years now (no Barclay cards) but just when i thought a balance was PIF and clear came the statement many days later with a balance that burned my tail. (when PIF i expect end of charge), That right there led me to eventually close my account with them.

Re: Are there any cards left that don't charge residual interest?

EAJuggalo — Fri, 18 Feb 2022 13:10:24 GMT

I can tell you from personal experience in the last 6 weeks that trailing interest is a thing with CapOne, Chase, Amex, Citi and Discover. The only lender that did not charge me trailing interest when I paid them off with my consolidation loan was Synchrony on my Amazon card.

Re: Are there any cards left that don't charge residual interest?

Anonymous — Sat, 19 Feb 2022 01:28:45 GMT

@CreditMagic7 wrote:
(when PIF i expect end of charge), That right there led me to eventually close my account with them.

But to some extent, that is not a reasonable expectation. The balance on the statement reflects the interest due up to the date of the statement, and not any interest that accumulates between then and the time you pay.

Now if credit cards didn't have a grace period ever this would be well understood, you pay interest from the time you make the purchase till the time you pay for the purchase. But most cards have a grace period for purchases if you PIF. But that's just a rule with conditions, and when you break the conditions, residual/trailing interest makes sense.

It's the same when paying off a mortgage, and I don't see the same angst over that! If you just paid off the balance of the last statement, that usually isn't enough, and you have to ask for a closing statement (and then they give you an amount assuming you pay by a certain time)

Re: Are there any cards left that don't charge residual interest?

FinStar — Sat, 19 Feb 2022 01:42:21 GMT

@Anonymous wrote:
@CreditMagic7 wrote:
(when PIF i expect end of charge), That right there led me to eventually close my account with them.
But to some extent, that is not a reasonable expectation. The balance on the statement reflects the interest due up to the date of the statement, and not any interest that accumulates between then and the time you pay.

Now if credit cards didn't have a grace period ever this would be well understood, you pay interest from the time you make the purchase till the time you pay for the purchase. But most cards have a grace period for purchases if you PIF. But that's just a rule with conditions, and when you break the conditions, residual/trailing interest makes sense.

It's the same when paying off a mortgage, and I don't see the same angst over that! If you just paid off the balance of the last statement, that usually isn't enough, and you have to ask for a closing statement (and then they give you an amount assuming you pay by a certain time)

Plus, if one leverages 'float' to their advantage, then there's not going to be any residual interest.

Re: Are there any cards left that don't charge residual interest?

Jshepherd04 — Sun, 20 Feb 2022 11:38:10 GMT

NFCU does trailing interest also. I paid a balance off a couple months ago and then next statement had a $0.14 balance.

Re: Are there any cards left that don't charge residual interest?

AverageJoesCredit — Sun, 20 Feb 2022 13:08:26 GMT

@Jshepherd04 wrote:
NFCU does trailing interest also. I paid a balance off a couple months ago and then next statement had a $0.14 balance.

Yes, i recently bt'd away my balance on my Navy Plat to PF. Paid to 0. Luckily. I sign in quite often to check my balances and a statement cut with $11 lol. Paid it for sure. Even after i btd away all my Dads debt to my Navy card i told him to keep checking those cards for trailing interest until he sees 0 owed.