Capital One Ripoff $25 Finance charge on a $0 Balance? Richmond Virginia
For the first time in 10 years after paying in full 100% of the time, we missed a payment - but only because when for the first time we disputed (and won) a charge and were informed by Cap One a re-adjusted bill was in the mail. We never received that - instead we received a harassing call - then a whopping finance and late fee.We immediately paid in full the entire balance, all charged, and fees. That was two weeks ago.
Yesterday we get a bill - it shows a $0 balance - and a finance charge of $24.00 on that balance. Must be the new math, because I was always taught 0 * anything == 0.
Dean
Apex, North Carolina
U.S.A.
5 Updates & Rebuttals
Anonymous
London,Ontario,
Canada
Residual Interest
#6Consumer Suggestion
Thu, August 23, 2007
It's called residual interest. It's essentially the interest from the first day of the billing cycle to when the payment is received. For example if you statment closed on the 10th with an ending balance $100 (and it's a carried balance where you are not paying the full balance every month) the carried balance accrues interest on the 11th, 12th, 13th, 14th and so on until we receive payment. However this interest is not added until the last day of the billing cycle. To reset the grace period and stop seeing finance charges, you need to pay the full ending balance for two consecutive billing cycles, and poof! grace period resets and no more finance charges given you pay your full ending balance.
Anonymous
London,Ontario,
Canada
Residual Interest
#6Consumer Suggestion
Thu, August 23, 2007
It's called residual interest. It's essentially the interest from the first day of the billing cycle to when the payment is received. For example if you statment closed on the 10th with an ending balance $100 (and it's a carried balance where you are not paying the full balance every month) the carried balance accrues interest on the 11th, 12th, 13th, 14th and so on until we receive payment. However this interest is not added until the last day of the billing cycle. To reset the grace period and stop seeing finance charges, you need to pay the full ending balance for two consecutive billing cycles, and poof! grace period resets and no more finance charges given you pay your full ending balance.
Anonymous
London,Ontario,
Canada
Residual Interest
#6Consumer Suggestion
Thu, August 23, 2007
It's called residual interest. It's essentially the interest from the first day of the billing cycle to when the payment is received. For example if you statment closed on the 10th with an ending balance $100 (and it's a carried balance where you are not paying the full balance every month) the carried balance accrues interest on the 11th, 12th, 13th, 14th and so on until we receive payment. However this interest is not added until the last day of the billing cycle. To reset the grace period and stop seeing finance charges, you need to pay the full ending balance for two consecutive billing cycles, and poof! grace period resets and no more finance charges given you pay your full ending balance.
Anonymous
London,Ontario,
Canada
Residual Interest
#6Consumer Suggestion
Thu, August 23, 2007
It's called residual interest. It's essentially the interest from the first day of the billing cycle to when the payment is received. For example if you statment closed on the 10th with an ending balance $100 (and it's a carried balance where you are not paying the full balance every month) the carried balance accrues interest on the 11th, 12th, 13th, 14th and so on until we receive payment. However this interest is not added until the last day of the billing cycle. To reset the grace period and stop seeing finance charges, you need to pay the full ending balance for two consecutive billing cycles, and poof! grace period resets and no more finance charges given you pay your full ending balance.
Mark
New Bern,North Carolina,
U.S.A.
Fuzzy math
#6Consumer Suggestion
Fri, May 25, 2007
Here's the thing: You only get a grace period from finance charges if you pay in full EVERY month. If you miss one month -- either miss the entire payment (as was your case) or if you pay even one penny less than the total balance due showing on your bill -- then that grace period immediately evaporates. Instead you are retroactively charged the interest that you accrued from the beginning of your billing period. Once you pay your balance in full for two consecutive cycles, your grace period will be restored.
I'm not exactly sure how to explain WHY that is, but that's the deal.