Get this, I paid off my GM card balance last week and yesterday evening, I noticed a new balance of $3.85. I called customer service and was informed that, yes, I have a balance of $3.85. I politely informed the rep that the account had been paid in full well before the due date. She politely informed me that I have "trailing interest." TRAILING INTEREST...WHAT'S THAT? If you balance transfer, write a check from your credit card account, or take a cash advance the interest rate is compounded on a daily basis. So, even though the account was paid (in full) the total amount of the billing statement, interest will accrue each day from the date of the original transaction. So, be careful when you pay off an account used to balance transfer, write a check, or to take a cash advance because the interest could still be chasing your wallet. CardKid
Many credit card companies are doing this these days. If you have balance on a credit card you have to call for a payoff instead of just paying the balance from your credit card statement. It's ridiculous, but I guess anything to make a dollar. Dani
It was a shock to me because the interest is supposed to be based on the principle and the "billing cycle." I don't recall reading about "trailing interest" in the account terms and conditions. This practice could result in millions of dollars in additional revenue for banks. I hope it results in class action. Catch my drift? CardKid
I had the same experience with Discover. When I BT'd away from their card and closed the account, I still got a bill the following month for about 20 bucks. I thought it had to do with the two-cycle billing that they use--?
I had a "pay-off" balance from Cap One for about $14.00 that were finance charges from the previous month. I called retention and had them reversed. I had a pay off balance from both BofA and Cap One (later) and included that in my calculations when I did pay the accounts off. I now have a credit balance on both. It works somewhat like a car loan.
What a hassle, calling the bank asking for a pay-off each time. I smell a suit coming because it's not written in any of the terms and conditions of the cards I'm using. What law could they possible hide behind? They probably sneak it in when 6 months down the road, they amend the terms and conditions. CardKid
When I pay off a BT...I "OVER-PAY" to STOP the interest clock... They CAN'T charge you any interest on a "CREDIT BALANCE"...
