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Thread: Question on credit card payment

  1. #1

    Default Question on credit card payment

    As we r aware, there's 2 types of cc bill payment. Full payment and minimum payment. Question is does minimum payment reflects badly on our credit report? Will it affect our future loan application, say for hdb etc, from the bank?

  2. #2
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    Default Re: Question on credit card payment

    No it doesn't, but the interest on the late payment is worse than loansharks.

  3. #3

    Default Re: Question on credit card payment

    Quote Originally Posted by espn
    No it doesn't, but the interest on the late payment is worse than loansharks.
    thks espn

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    Default Re: Question on credit card payment

    Quote Originally Posted by wind
    As we r aware, there's 2 types of cc bill payment. Full payment and minimum payment. Question is does minimum payment reflects badly on our credit report? Will it affect our future loan application, say for hdb etc, from the bank?
    hmm... frm wat i know, it doesn't affect any credit ratings. Credit ratings dependent on ur income tax mostly. full payment on cc=no interests chargable (except if u pay late). Min payment= remaining amt chargable 24%/pa and rollable. Meaning. u get charged 2%/mth on any outstanding payment; which include the interests incurred during the previous months and not yet paid off too. so it can roll up to pretty big if u're not careful. Of cos u will not be penalised by these banks in future for any loans. They are more happy that u pay min payment or late payment, cos they're actually making more from their interest charges. If u pay on time full amt every mth, the onli thing they're making is ur annual subscription fees, which u will most probably call in to request a wavier (supposedly wat alot of pple do). Hope this helps.

    ***Disclaimer: Views expressed are personal opinions and not representative of any bodies or institutions. These opinions should be taken with caution to its certitude. The author disclaims any liabilities arising from anyone following these opinions. ***
    Last edited by esmondng; 19th May 2006 at 09:03 PM.

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    Default Re: Question on credit card payment

    Quote Originally Posted by wind
    As we r aware, there's 2 types of cc bill payment. Full payment and minimum payment. Question is does minimum payment reflects badly on our credit report? Will it affect our future loan application, say for hdb etc, from the bank?
    Ur first time having credit card?

    Ok, let me tell u. Minimum payment means that u merely paid up PART of the bill (usually $50 or $100) but not in full. In short u still owe the credit company money and to that unpaid amount, the math is relatively simple - They charge u interest on the unpaid sum for that particular month. Assuming if the next month, when the bill arrives and u still pay the minimum sum? Simple, on top of last month's unpaid amount + interest, they will the current month's unpaid amount and add onto more interest.

    It doesn't take a genius to know that simple fact that once u owe money and keep rolling interest, comes a day that credit ratings doesn't matter when u have to declare bankrupt.

    Full payment = U paid up whatever u owed. U owe nothing, they charge u no extras and the rest of the logic just falls into place.

    Short, sweet and simple plain common sense.
    "Wonders of the Human Mind. Unfathomable to the highest degree."

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    Default Re: Question on credit card payment

    Credit card companies love ppl who pay only the minimum sum every month and roll over the unpaid sum to next month's bill. This way, they can charge u hefty interest rate and that's how they make the money. If u pay up your total bill every month, they don't really earn anything from you except your annual subscription. Even with annual subscription, many banks are willing to waive it if u use your card often. The credit card can be a bottomless pit which many fell into before realising it too late. Never spend more than what you can afford to pay up in full otherwise the accumulated interest rate every month will eventually bankrupt you.

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    Default Re: Question on credit card payment

    To quote the little book that's sent together with every new Credit Card...

    "A credit card is merely a convenient paying mechanism"
    "Wonders of the Human Mind. Unfathomable to the highest degree."

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    Default Re: Question on credit card payment

    Another word to describe - Legal "loanshark"
    除了爱, 我一无所有

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    Default Re: Question on credit card payment

    It turns into loanshark IF u make it so that way. That is - pay minimum sum.

    Otherwise, its ur best friend.
    "Wonders of the Human Mind. Unfathomable to the highest degree."

  10. #10

    Default Re: Question on credit card payment

    thks esmondng and redstorm. didn't know paying minimum sum actually incur 2%.....have always been making full payment all these years. very informative!

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    Default Re: Question on credit card payment

    Quote Originally Posted by wind
    thks esmondng and redstorm. didn't know paying minimum sum actually incur 2%.....have always been making full payment all these years. very informative!
    Do note that if you do not pay in full for the previous month, on top of the interest that they will charge you for outstanding amount, interest will also be charge on whatever amount your sign for the current month. That's why it is always good to clear your bill every month.
    除了爱, 我一无所有

  12. #12

    Default Re: Question on credit card payment

    Quote Originally Posted by wind
    As we r aware, there's 2 types of cc bill payment. Full payment and minimum payment. Question is does minimum payment reflects badly on our credit report? Will it affect our future loan application, say for hdb etc, from the bank?
    If I am not mistaken, it does reflect on your credit report. Badly or not is subjective to whoever reads and assess the information isnt it

    And all banks will assess your credit report before processing any application (credit card, credit line, loan including those you take for house). The impact may range from acceptance to terms changed loan agreement to rejection. It all depends on the bank assess and decide on your "credibility".

    If any one ever wonder why you get rejected for a new CC application while another friend of yours who already have 3-4 cards, still receives new CC application offers from banks, its all about "credibility".

    The more promptly you pay (overdues, etc) ,how fast you clear your debts and how much debts you have will impact all those.

    My recommendations are
    1) Never let your bills go overdue unpaid. Its not worth paying the CC interest + overdue fine.
    2) Try to clear your outstanding dues within 3-6 months period.

    Hope that helps.

  13. #13

    Default Re: Question on credit card payment

    Please do take note that for credit card bill ... it is 24% p.a. ... Be careful about that as the bill could be very high then you least expected it if you do not pay in FULL ....
    AMPA * WPPI * J team

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    Default Re: Question on credit card payment

    Partial payment of your monthly CC bill IS reflected in your Credit Report kept by Credit Bureau. (can be obtained from Singpost for $5)

    I've gotten a copy of my own Credit Report and for the months that I've just paid partially, it was reflected in the Report. But the Report will only reflect the records of the past 12 months.

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    Default Re: Question on credit card payment

    think bank wil love you more if you pay minimum sum, they earn interest....as long as you always keep paying your bills...you will have good ratings.

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    Default Re: Question on credit card payment

    hmm ic...
    helps me to understand too. thanks everyone.

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