Yes, what you described will give 0 interest and report 0 balance if paying entire balance.
@CreditDunce wrote:
@thehogsters wrote:
My cc is due on the 14th but my statement is not until the 17th. Does this mean I have to pay the full balance by the 14th and not use this cc until the 17th or 18th?Assuming you PIF last month: To not pay interest, you just have to pay the entire amount due by the due date. You do not have to pay the entire balance. Only the amount from the last statement. Moreover, you can use the CC between the due date and the statement date.
You do not need for the CC to report a zero balance to not pay interest.
Note: If you have a sub-prime/rebuilder CC without a grace period, you will always pay interest from the transaction date. Rebuilder cards should be SD/closed as soon as you can get something better.
right. If no interest is the goal, you just need to pay the previous statement balance by the due date each month. The whole thing about paying early before the billing statement and then not using the card until the statement is something that some people do to try to get a boost to their score before an application for new credit. This boost can be significant if your card limit is low, but if you are not applying for anything and just don't want to pay interest, it isn't something that you need to do.
EX:694 TU:744 EQ:777
If you have already made a payment in the amount of $1800 and $3600 since the statement cut showing a due date of 8/14, you have already PIF and therefore will not have any interest.
The easiest way to both avoid mistakes AND interest is to use your CC company's auto-pay feature. Configure it to pay the full balance, and you'll be fine.
@thehogsters wrote:
I'm still confused since it's is my first due date with this (southwest priemer) card. I got the card in the end of June and Aug 14th is the first due date. My first statement was for $1700 but I have made 2 payments of $1800 and $3600 since then. So do I need to pay my balance under $1700 for no interest?
If you had paid $1700 by the due date, this would be considered paid in full. You paid a lot more than that, which means that you are paying charges after they post but before they are billed. This will allow a lower utilization to report to the CRAs if that is what you are trying to do, but as for interest it has no benefit. If you always pay the statement balance by the due date, credit cards work like a short interest-free loan.
Basically the cycle goes like this:
- billing statement = this shows previous charges, an amount owed, and a due date.
- due date = if the amount owed on the last statement is paid by this date, no interest will accrue
- billing statement = this shows the previous charges and the last payment, an amount owed, and a due date.
- due date = if the amount owed on the last statement is paid by this date, no interest will accrue
Sometimes you can get close to 60 days interest-free. Imagine if your statement was on June 17 and you made a charge on June 18. You paid your June statement balance by the July due date and then your billing statement comes out on July 17 and shows the charge from June 18. It also shows that you have until the Aug 14th to pay the bill. If you paid your July statement balance on August 14th, you would have floated that June 18th purchase for 58 days, all interest free.