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FenderGuy

So asked for total pay off and yet something if off?

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Hello newbie to the board but not to credit (or so I thought)

 

So I recently did some balance transfers paying off higher go nowhere interest cards and I asked for total pay offs from Wells (CC and LOC) and Chase CC. Have you ever looked at how these banks calculate interest and fees and or old balance transfers? It’s either simple or complex (Chase), I feel that Chase has collected fees that were not owed to them and upon creating my own spreadsheet applied a less than the amount paid to collect that interest. Can someone point to a research tool that help me understand how they apply multiple payments and total payment and what is really owed for in arears interest and fees?

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welcome to CB!

 

the terms of your agreement with a creditor detail how interest in calculated. what fees, for example, do you think chase has collected that violate the contract?

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Well looking at Previous statements on how they calculated interest and balance transfer fees in arrears doesn't seem right. I have attached a June and July statement (No personal info is shown) of how fees were calculated and it seems for July they only removed $941.58 and left the rest of balance instead of payments being over $3,255 at the due date, where the hell did they get $941.58 only being applied towards the balance from June? I didnt make a payment of $941.58 back in June

June.png

July 2019.png

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I think where you are getting confused is that there is no grace period when you carry a balance, interest is accruing every day.  So if you statement cut on June 26th, you are accruing interest based on the balance every day, not on the balance at the end of your next statement, even if you paid the whole balance off before the next due date.  So it looks like you paid it off on July 22-24, so you still owe the interest from June 26 till July 22 on the whole balance, then Interest on a lower balance on the 23rd (after your payment) and so forth.

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No I understand that there is no grace period on items that are past the 0% APR period and interest accruing, which is why I asked for a total balance pay off with all fees and interest included, both Chase and Wells couldn't give me this, I had to call 2 times and go into a branch store. I think you are confused on the above statement since it is in arrears but you are right if it is for June to July back interest and fees, where did they come up with a $941.58 payment being applied to that period, if the opening date is 06/27/2019 and closing date is 07/26/2019, again where does the $941.58 apply?

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Posted (edited)
2 hours ago, FenderGuy said:

No I understand that there is no grace period on items that are past the 0% APR period and interest accruing, which is why I asked for a total balance pay off with all fees and interest included, both Chase and Wells couldn't give me this, I had to call 2 times and go into a branch store. I think you are confused on the above statement since it is in arrears but you are right if it is for June to July back interest and fees, where did they come up with a $941.58 payment being applied to that period, if the opening date is 06/27/2019 and closing date is 07/26/2019, again where does the $941.58 apply?

If you had a zero balance on June 26, charge things and then make a payment somewhere during the month on the amount of $941.58, then your closing balance on July 26 would reflect the difference that remained.  However, you did not have a zero balance on June 27 and so interest was accumulating during the entirety of the month.  In such an instance, you want to make that $941.58 in payments at the earliest possible date so as to reduce the average daily balance upon which interest is being accumulated. 

 

And given that you have an insane APR that shows as applying right now, you need to be clearing the entirety of that balance since you are paying more than two points a month.  At $7200+ in balances, your current APR is saddling you with roughly $150 EACH MONTH in interest,  Money pissed away and for which you receive precisely ZERO benefit from and will NEVER get a benefit from. 

 

I should add that I am confused about the whole $941.58 thing since I don't see anything on those pages that matches such an amount.  When images don't match the question, it complicates the discussion...

Edited by centex

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Yes you are confused as you are not looking at the July statement  it clearly shows 2 charges of interest one for the purchases  and one for balance transfers....In that amount it was Chase that applied a $941.58 payments to those 2 fields, if you see the June statement that $941.58 was applied for July 

 

Example June (See statement) 

Interest charged  
     
 $  7,024.33    $         146.11
     
 $  1,136.69    $           23.64
     
 $  8,161.02    $         169.75

 

July Statement 

 

Interest charged      
         
 $  6,190.50    $         124.61    $ 833.83
         
 $  1,028.94    $           20.71    $ 107.75
         
 $  7,219.44    $         145.32    $ 941.58 

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I was under the impression you were discussing a line-item entry, and NOT the differences in Average Daily Balance (which is what those fields represent).

 

For the amount of payments that allegedly posted during the month, you had a lot of purchases made which are NOT line-item entries on the pages you chose to show as images here.  You COMPOUNDED your error by not making payments until late in the month, which means you had almost an entire month at which the average daily balance was at an elevated level.  You would have seen lower numbers had you made the payments on the first and second day of the cycle AND made no further charges during the month. 

 

Cue the comments from Hege and CV about math being hard...

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Interest is charged on your average daily balance. The change between June and July does not indicate how much you paid in that month. As others have mentioned, you made those payments late in the cycle, so the average balance only went down by $941.58.

 

For an easy example, if you have a balance of $10k for 25 of the 30 days in the cycle and then pay off $8k, your average daily balance is not $2k, but is calculated as ($10k * 25) + ($2k * 5) / 30 = $8666.67.

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Posted (edited)

This statement is made with absolutely no disrespect for Fender Guy:  If there's an online primer along the lines of "Credit Card Statements 101", you need to avail yourself of it immediately. 

 

Anyone who is spending $1k+ annually on finance charges needs to COMPLETELY grasp how those charges are assessed.  (The discussion here reveals some serious gaps in that grasp.)

Edited by hdporter

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