Trailing interest is standard for everyone. Unfortunately, if you're paying in full or always carrying a balance every month, you'll never run into it so it'll be a big surprise if you're not aware it exists or how credit cards are billed.
You can try writing goodwill letters to CITI and Macy's executive offices, maybe the CEOs. There really isn't anything else you can do other than to bombard them with letters and calls. Sorry.
@Anonymous wrote:My mother doesn't know too much about credit on a deeper level like some here on the forum.
... Bewildered, she was wondering how this could happen...after calling Macy's they tell her becasuse there was a compounding interest amount that hit her account after.
... The thing is, it wasn't really my mothers fault either. She isn't a financial professional.
... I feel Macy's is being SUPER petty - and I was wondering if anybody can offer any type of advice for this?
Welcome to My Fico Forums, @Anonymous. Unfortunately, we won't have good news for you. Yes, it's obvious that your mom didn't understand credit. Like your mom, the great majority of people with credit cards are also not "financial professionals" but we all still have an obligation to understand financial agreements before we enter into them. So yes, she was at fault since trailing (or compounding) interest is a pretty universal concept with credit and she is ultimately responsible, even if she didn't understand. Granted, that some lenders might be compassionate and forgiving but they aren't required to be. I've had some go either way when I've made an honest mistake.
As for advice, it's not so much about fixing what has already happened as much as it to protect her from additional errors in the future:
(1) Do you and your mother understand what happened?? It doesn't sound like you really do, and this is the most important thing: learn from our mistakes. Credit cards typically have a "grace period" that usually lasts for about three weeks from the statement cut date until the payment due date. With most credit card agreements, if you have NEW charges (posted since the previous statement cut date) and you pay all new charges IN FULL monthly, you won't owe any interest. However, if you're carrying a balance like Mom did, that interest is accumulating day-by-day until the bill is paid. So if you're carrying charges, you always need to allow for a little extra. There are ways to estimate the amount due and add that to your payment, but you can also just wait for the follow-on statement and pay the trailing interest.
(2) Mom apparently didn't have automatic minimum payments enabled since it sounds like she got late payment charges and late pays reported to the CRBs. This is very easy to do with most cards and is a great safeguard for a situation like this. She should have it enabled on all her cards. Most will not charge the minimum payment if you make a manual payment before the due date. If Mom had paid her balance in full and had automatic payments in place, this likely would have paid off the trailing interest with the next statement and completely avoided this situation even if she was out of the country and didn't log into her account.
(3) "Goodwill Letters" as mentioned are your only real recourse. If you do a web search for the term goodwill letters, you'll find examples. Basically, you're NICELY and POLITELY asking the lender to forgive your mistake. You describe what happened. You accept your part of the blame (which it doesn't sound like you did when you called before.) You tell them what you did to "fix" it, such as educating yourself about how it happened and enabling automatic payments. And you ask for them to make a "goodwill adjustment" to the information being reported to the CRB. Sometimes, the first letter won't work but if you continue to send them to different addresses and management levels of the lender, you may get results eventually.
Once again, welcome and I hope you have good luck sorting this out!
@Anonymous wrote:But I feel like if the website says this is what your balance is 850 dollars, that to a normal person means this is what you owe to Macy's. She paid off her entire balance based on what the online portal was telling her.
shouldnt any money owed be added to the balance being quoted?
she paid off the entire balance that was showing on the website . Only to find out that that balance didn't factor in later interest.
she didn't see any warning because she was out of the country
@Anonymous, have you or your mom ever had a car loan or a mortgage? And have you ever gone to pay off that car or sell the house? Both of those loans typically work the same way as most credit cards. They accrue interest DAILY, not MONTHLY. So you have to get a "Pay Off Balance" quoted by the lender to know exactly how much you owe on any given date. If Mom's charges were all posted since the last statement, that balance showing on the website WOULD have been correct (but only because credit cards usually include a 'grace period' for new charges.) But since she was carrying a balance she owed interest on every day since the last statement. Bank websites don't update on a daily real-time basis. They show the information available as-of the last statement cut. This is standard across the industry and there is nothing predatory going on here.
@Anonymous wrote:But I feel like if the website says this is what your balance is 850 dollars, that to a normal person means this is what you owe to Macy's. She paid off her entire balance based on what the online portal was telling her.
shouldnt any money owed be added to the balance being quoted?
she paid off the entire balance that was showing on the website . Only to find out that that balance didn't factor in later interest.
she didn't see any warning because she was out of the country
I truly do not mean to pile on, but this is why assumptions and actions predicated on feelings are misguided.
Feelings have no IQ. What we are bound by relative to credit are FACTS...and the fact is, your mother did not have accurate comprehension of how her credit product worked.
Take it as a lesson learned and move forward, as we all have at some point or another.
