From: Alan 
Newsgroups: uk.finance
Subject: Re: CC interest charges
Date: Mon, 26 Jun 2006 10:02:43 +0100

In message , nonameman 
 wrote
>All
>
>I got a Virgin credit card last year with 0% interest for 9 months on
>balance transfers. Since moving money onto the card I've been paying it off
>at between £50 and £350 each month and have not put any purchases onto the
>card. The only charge going on each month is the Repayment Protector (RP)
>which incurs interest which is okay but I can't fathom why when the balance,
>and RP charge go down each month, the interest charged goes up. It's only
>pence but it's something I'd like to understand.
>
>
>Month    Balance   RP       Interest
>Nov        1,786      12.86     0.09
>Feb        1,007        7.25      0.44
>Jun            205        1.48     0.73
>
>
>Does this make sense to anyone? If so could you explain it to me in layman's
>terms?
>

You have paid nothing off the Repayment Protector part of the bill. 
Virgin are putting these payments on your card but you are only paying 
off the original interest free part of the bill. You will not start 
paying off any amount that attracts an interest payment until you have 
cleared, in full, the interest free part of the bill.

You would have been better off just paying the minimum amount each month 
on the card while it is interest free and putting any money over the 
minimum payment into an instant access savings account paying 4.5%+ . 
BEFORE the end of the 9 month interest free period transfer the money in 
the savings account to pay off the credit card bill.

-- 
Alan
news2006 {at} amac {dot} f2s {dot} com