At what point do credit card transactions charge interest?

[chibwack]

I've started using my credit card for all my day to day purchases, and so far I've just been transferring from chequing into it every night to cover the days charges. This is a bit of a pain in the ass. When do I actually start paying interest? Could I just clear up the balance every month end and not face any interest charge, or how does that work?

[JAYMEZ]

Dont quote me but I think with some cards its 14 days ... Other cards 24 days. .. I know its not a full month.

[Thaco]

depends on your terms.

[schocker]

Wat, why would you pay it every day instead of just once a month when you get your statement :nut:

[SilverGS]

You don't get charged interest until after you get your statement and the due date passes. As long as you pay before that you won't be charged any interest.

So if you buy something at the beginning of your cycle you have a month and a half or so. If you purchase at the end of your billing cycle it will be 2 weeks or so.

IF you do go past your statement due date though they might retroactively charge you interest starting from the day you purchased the item.

[yellowsnow]

My card has a 28 day grace period. Usually as long you make the full balance payment before the due date on your statement, you won't be charged interest.

unless you have one of those line of credit credit cards

[guessboi]

Just clear the balance before the due date each month.

Otherwise you shouldn't be using credit to pay for stuff you can't afford.

[NoMoreG35]

Yeah why would u pay every night? I always pay after I get the e-statement. Been doing it for 10+ years, not a single cent of interest AFAIK.

[JLau]

most cards have 30 days grace period, but for cash advances, they are instant

[sabad66]

As long as you pay your balance off in full, interest doesn't start until after your due date. So for you, you're absolutely wasting your time transferring from checkings every day... just wait until you get your bill then pay it off and you won't get charged any interest. In fact, if you time it right and know your cycles, you can essentially use a CC to get a "free" 1.5 month loan.

Note that this doens't apply for cash advances... if you pull cash out of your CC then interest starts right away (compounded daily like all CC interest).

[dirtsniffer]

above 2 posters are correct afaik

[chibwack]

Ahh, 21 days. Turns out I just have to read my mail for once :thumbsup:

[Thaco]

I pay mine down once a week or so, just to be safe... because i use my card for all transactions due to cash back.

[Mar]

This is what I was told at the bank last week.

They take the annual interest and split it up by 365, then charge you that percent of interest daily. However you don't actually get charged the interest until that one day of the month where all of it gets thrown at you at once. Pay it off before then and all the accumulated interest gets thrown away.

I was told for my mortgage which I just renewed that it gets compounded semi-annually which means I can not pay for 6 months before I get charged that 6 months of interest. They just bill me monthly out of convenience.

[Frankie88]

after 21 days grace period on most cards

[thetransporter]

pick yourself up a charge card - no interest but you pay in full - but they have pay over time options (amex)

[Cooked Rice]

If you don't pay your balance off in full before the due date, this also applies: You are charged interest back to the date you made these purchases until you make a payment that covers the full amount of these purchases.

So if you bought something at the beginning of the month, and didn't pay off your balance in full. You will still be charged 21 days interest on whatever balance you didn't pay on your next statement. Your 21 day grace period only applies to whatever you can have paid off by the due date. For example you bought 1 item for $1000 and it was the only thing you used your CC for that month, you paid $600 before the due date, and you paid the remaining $400 the day right after your due date, you will still get charged X days(from the date you made the purchase, to the date you paid it off fully) of interest for that $400 on your next statement. As the 21 grace period does not count for what you couldn't pay off.

[Xtrema]

Originally posted by SilverGS
You don't get charged interest until after you get your statement and the due date passes. As long as you pay before that you won't be charged any interest.

There you go. Read you monthly statement. Clear the balance and there will be no interest.

Unless it's cash advance or balance transfer. Cash advance from CC charges interest starting on the date of withdrawal until the account is paid in full. Balance transfer is based on if there are any teaser rates. Be careful on these 2, I'm not 100% sure but once used, all your payments will go against these 1st before they go against your purchases. Which means it may incurr even more interests on your day to day purchases.