Charging interest before you owe it
- Blog Post by:
- January 25, 2010 - 12:40 PM
After charging $58.37 on a store credit card that had sat dormant for years, a Minneapolis man noticed an unusual interest charge. Even though he hadn’t carried over a balance, he was told to pay $2 in interest. His new balance even stated that he owed $60.37. Here’s what he wrote to Whistleblower:
SmartMoney magazine reported on this practice in December and compared it to double-cycle billing, which calculated interest based on the past two billing cycles. The Credit Card Accountability, Responsibility, and Disclosure (CARD) Act of 2009 prohibits credit card companies from charging interest on a balance from a current or prior billing cycle, but that regulation only applies to cards that have a grace period.
Have you noticed this on your credit card statement? What do you think of this practice?
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