Sunday, May 20, 2007

Double Cycle Billing

Reading the book Maxed Out by James Scurlock. It's a tirade against credit card companies and the way that they go after people. I read a paragraph about double cycle billing (actually less than that, the focus was on something else).

So I did a quick search with a generic search engine and found what double cycle billing was all about. Turns out, I got hit with this last month!

I typically pay my credit card in full each month. I use it a lot, gas, eating out, just about any purchase over a few bucks is on my credit card. Some purchases go on my debit card, but most on credit. Last year, I probably paid under $25 in interest, probably $0, but I can't be sure

So the bill comes monthly and is typically high. No bother, I have enough to cover it, I watch the balance carefully. But a few months ago, I got overly busy and made the payment late. Ok, a late fee and interest, I expect. It was painful (over the $25 mentioned earlier), but it was my mistake.

However, the next month's bill, I was charged interest again, even though the previous balance had been paid in full. I called the credit card company and they explained that this was there policy. If you did not pay the credit card in full, you were charged interest for that month and the following month.

I explained that I switch to this card a few years ago because of some issues with my previous card and that unless something could be done about this charge, I would switch again. The phone call was transferred to cancellations who took my information and my complaint. After a few minutes on hold, I was told that the charge would be eliminated. Checking my account online confirms it has been done.

Morals of the story:
1) Pay your credit card bill in full each month and you don't have to worry
2) If you don't pay in full, know the charges well
3) If you don't like the terms, ask for them to be changed or change cards

1 comment:

Neil said...

Thanks for the tip! I always pay in full every month. But one time I accidentally paid the wrong credit card (so I was running a postive balance on it). Both cards were with Chase. they probably did the double charge thing.

Just one more reason to always pay in full!

Chase now lets you auto pay the full amount, which helps.