When to pay off a balance with a promotional APR

Discuss anything related to interest rates & fees, like balance transfer offers, low rate cards, annual fees, etc.
3 posts
Capital
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When to pay off a balance with a promotional APR

Postby Capital » Sat Dec 24, 2011 1:20 am

I'm trying to plan when I need to pay off a balance that I took out for a promotional APR. Say I have an AMEX which I opened at the end of July 2011 with a 6-month, 0% promotional APR. My statement period ends on the 17th of each month, so I received my first statement on August 17, 2011.

My question is: do I pay my balance in full at the end of my statement cycle (January 17, 2012) or by the due date of that statement cycle (February 11, 2012) to avoid interest charges?

I have other bills that need to be paid around the same time, so timing is key here and the difference between these two dates is nearly a months-worth of pay. If anyone has any experience with these promotional APR's, I would greatly appreciate your insights.


jeffysdad
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Postby jeffysdad » Sat Dec 24, 2011 7:44 am

It's good to plan ahead like you're doing. When I was card surfing with BTs I tried to do the same thing.

That said, you should call up Amex and ask them specifically: "By exactly what date do I need to pay this balance off to avoid interest charges?" The rep. should be able to tell you that fairly easily. When they do, repeat it back and ask them if they are absolutely sure that's correct. If you're not confident in the answer, ask to speak with a supervisor.

I did the above several times with different creditors when I had promotional rates and I never had a problem getting a straight answer. There are just too many variables, too much fine print for you to be able to get a reliable answer from someone here who does not know all the details of the BT.
American Express: Blue Cash Preferred (groceries, 6%; gas, department store, 3%); Gold Delta SkyMiles (Delta Air Lines, 2 miles/dollar, free checked bag).
US Bank: Cash+ (utilities, phone, internet, restaurant, 5%; drugstores, 2%).
FIA Card Services: Fidelity Amex (everything, 2%); Fidelity Visa (everything, 1.5%).
Chase: Freedom (rotating, 5%); Amazon (Amazon.com, 3%); PriorityClub (IHG hotels, 5 points/dollar); Sapphire (not in use).

*All cards are registered with PriorityClub IDine program for 8 points/dollar at participating restaurants.

Capital
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Postby Capital » Sun Dec 25, 2011 1:02 pm

Fair enough. I thought someone on here might have had a bad experience with paying off a promo-balance late. In any case, I contacted AMEX twice this morning, and the first rep told me that the promotional rate expires on January 17, 2012. I inquired further and was told that new purchases after this date would be charged to my regular purchase APR. The rep was unclear about whether my current balance would be subject to finance charges during the 25 day grace period following the end of my 6th statement cycle and recommended that I pay the balance in full on or before the expiry date of the promo APR.

When I inquired with a second rep, she informed me that my account was opened on July 20, 2011. She also told me that my promotional rate expires on January 17, 2012 and that any purchases made after that date would be billed to my purchase APR. With the wording of the CARD Act of 2009, which mandates that promotional rates may not be less than 6 months after the rate takes effect (Title I, sec. 172), I am compelled to conclude that my promotional APR rate does not legally expire until January 20, 2012. The second rep told me that they count by "full statement cycles." When I challenged her on the fact that my first billing cycle was not a "full statement cycle," she agreed and told me to pay my balance in full by the payment due date of the last statement cycle to avoid paying finance charges. I don't plan on charging any further purchases to my AMEX between January 17 and January 20, so the previous argument does not really apply to my situation, but this sounds like grey area for the card issurer. In any case, the rep told me that I could take until February 11, 2012 to pay my balance in full to avoid paying finance charges (assuming that I don't make any more purchases).



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