Thanks for the info.
I have no CCs with them but on BTs I wont use them (any bank or CU) if more than the minimum goes to lower APRs and yeah I wouldnt do more than 1 BT onto a 0% APR offer unless as you learned the whole balance can be paid off when the first time period one expires. Thanks for posting this.
@Anonymous wrote:I just learned this the hard way and I'm sure it is in their fine print that I didn't read. I have a balance transfer that expires in Dec and the only way I can avoid paying interest is if I pay off my entire balance. My other balance transfers don't expire till June and July of next year and I did not budget to have them paid off in Dec. I did budget to pay off what I owed but it turns out doing so was pointless. They said a larger percentage of my payment will go to the balance that is accuring interest though, once that happens.
So while I do love PenFed I just wanted to give you folks fair warning. Do not do multiple balance transfers with them unless you are prepared to pay it all off in full early, pay interest or you can balance transfer the rest of your balance to another card.
Well, the solution is to wait until the earliest BT expires and flips into an interest cost situation. At that point it becomes a "higher interest" tranche. Sending funds to BT it off the PenFed card takes that balance first, leaves the longer running BT's untouched. There would be a few dollars of interest on the expired BT, but if it still has until Dec to run, you aren't maximizing the interest savings anyhow by trying to move it in September.
@Anonymous wrote:I just learned this the hard way and I'm sure it is in their fine print that I didn't read. I have a balance transfer that expires in Dec and the only way I can avoid paying interest is if I pay off my entire balance. My other balance transfers don't expire till June and July of next year and I did not budget to have them paid off in Dec. I did budget to pay off what I owed but it turns out doing so was pointless. They said a larger percentage of my payment will go to the balance that is accuring interest though, once that happens.
So while I do love PenFed I just wanted to give you folks fair warning. Do not do multiple balance transfers with them unless you are prepared to pay it all off in full early, pay interest or you can balance transfer the rest of your balance to another card.
This is not unique to PenFed and is merely in compliance with federal law. Since the pasing of the CARD Act in 2009, credit card issuers MUST apply any payments above the minimum payment and any fees toward the balance with the highest interest rate first before applying it to those balances with lower interest rates. Normally this is not an issue with multiple balance transfers as most lenders will apply payments toward the one expiring soonest if they are at the same APR. The issue comes when you mix and match say a "4.99% APR no fee" and "0% with 3% fee" offer together. By law, they must apply any payments over the minimum (and any fees) to the 4.99% balance even if it's a transfer you did last month and the 0% is expiring this month.
The three solutions to prevent the issue would be a.) do not mix and match balance transfers with different terms, b.) only mix and match balance transfers when the next transfer has a lower APR than the one before it, or c.) wait until the expiring balance transfer promo that has a lower APR actually ends and then make your payment. With the last one, yes might pay a few days of interest that accrued at the card's standard (or cash advance) APR but that should be minimal and would then make that balance the one with the highest APR and subject to receiving the allocation of your payment.
