Credit Card Warning to the unsuspecting. Balance Transfer and the portion of payment applied.

John Dough on 20/03/2015 - 07:37

So long story short.

I have a NAB credit card that is on a balance transfer of 0% for 18 months.

I took a cash advance of 1k on a credit card to pay a bill as I needed to pay it then and there even though I knew pay day was only a couple of days away.

I paid back the 1k plus the $17.50 fee two days later.

NAB have kept charging me interest for this 1k ever since October last year. I saw it about a month ago on my statement and questioned it.

They said because the 1k had not yet been on a 'printed statement ' that my repayment was off the 0% portion. I needed to wait until that 1k was on my next statement before any payment could be applied to the cash advance portion.

Now I thought that's against the federal laws passed a little while ago, so i investigated.

http://learn.nab.com.au/where-do-credit-card-payments-go/
In Particular 'Be careful of spending in between statement periods' (How nice of them)

http://www.lawhandbook.org.au/handbook/ch13s01s02.php
In Particular: 'the requirement that credit card providers first allocate payments to the part of the closing balance shown in the last account statement to which the highest rate of interest applies'

NAB have kindly reversed a couple of the interest charges and I just paid the balance in the last couple of days as I'm pretty annoyed, so only about $50 out of pocket, but still not all that happy with the fact there is this catch that can penalise you for quickly repaying a cash advance!

So watch out, it's legal,(unethical imo) and they will sting you if you do this! Avoid cash advance at all costs…

Financial

Related Stores

National Australia Bank Group (NAB)
National Australia Bank Group (NAB)

Comments

  • Paul Atreides on 20/03/2015 - 09:29
    +1

    this has always been the case, but i guess now youve learnt.

    it comes down to the fact that you didnt do enough research before going through with the cash advance.

  • tooblue on 20/03/2015 - 15:14
    -4

    $1,000 cach advance from a balance transfer card. How desperate were you?
    What were you thinking? Or you don't think at all.

    • MelbBargainChaser77 on 20/03/2015 - 19:02
      +10

      tooblue please dont be so judgemental, everyones situation is different.

      • John Dough on 21/03/2015 - 13:39

        I reduced and have paid off other cards using BT for a while now and never once had to cash advance as I realise this is not a great option, but in a miscalculation, I accidentally put more than I should have into a card leaving myself short.
        Pretty easy mistake to make I'd say.

        Just trying to make anyone that cares aware of how the new laws are actually applied. I suspect not all that many people are aware of this detail.

        I thought the highest interest part of the card would be repaid first as per the new legislation, which is true, but only as at your last paper/pdf statement date.

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