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When you pay more than the minimum payment on a credit card how do you know it's going to the principal balance?
Wiki User
∙ 15y ago
It is actually quite simple. Any amount that you pay that exceeds the finance charges and any fees included within that minimum payment goes toward the principal. In addition, 100% of the overpayment goes toward the principal balance. In other words, if you make just the minimum payment, a few bucks might go toward the principal balance. If you pay $20 above the minimum payment, all of that $20 plus a few bucks from the minimum payment go toward the principal balance.
All of the overpayment goes toward principal. You can also look at the minimum payment calculation to determine how much of the minimum payment goes toward principal.
Wiki User
∙ 15y ago
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Why is it unwise to pay minimum credit on your credit card?
Paying only the minimum due on your credit card balance maximizes the amount of interest you will pay to the credit card company. This is why it is better to pay as much of your balance as you can each billing cycle - it saves you money by reducing the amount of interest you pay. Also, depending on the terms of your credit card agreement, paying the minimum can actually make your principal balance increase. The minimum payment may not cover the amount of interest due.
If one had a credit card balance of 400.222 at 21.99 interest and paid only the minimum payment how much of the payment would actually go to the principal balance and how long would it take to pay it?
Your current payment is $16.00. If you continue to make the minimum payments it will take you 4 years and 8 months to payoff this debt. The total interest paid will be $214.24
What does Minimum payment in your credit card bills mean What happens if pay less than the Minimum payment?
It's called minimum payment for a reason.. and that reason is that you don't have to pay you're full balance.. but you have to pay the minimum payment. NOTHING LESS
What is the minimum payment due on a credit card with a 50000 balance?
Most credit card issuers have moved to a monthly minimum payment due of 4% of the outstanding balance. For a $50,000 balance this would equate to $2,000. Some issuers only require 2% or 3% minimum payments, which would equate to $1,000 or $1,500, respectively. You would need to check with your credit card issuer to determine their particular minimum payment requirements. Check out CreditCards.com/calculators.php to look at different scenarios.
Can you send credit cards 5.00 per month and do they have to accept it?
Most credit card companies demand a minimum monthly payment of 5% of your balance owed.If you owe $1000 your minimum payment would be $50.You can send any amount you want. However your balance owing will steadily increase. It will only affect your credit rating.If you pay only the minimum payment each month, it will take years for you to pay your bill.
Why is it unwise to pay minimum credit on your credit card?
Paying only the minimum due on your credit card balance maximizes the amount of interest you will pay to the credit card company. This is why it is better to pay as much of your balance as you can each billing cycle - it saves you money by reducing the amount of interest you pay. Also, depending on the terms of your credit card agreement, paying the minimum can actually make your principal balance increase. The minimum payment may not cover the amount of interest due.
If one had a credit card balance of 400.222 at 21.99 interest and paid only the minimum payment how much of the payment would actually go to the principal balance and how long would it take to pay it?
Your current payment is $16.00. If you continue to make the minimum payments it will take you 4 years and 8 months to payoff this debt. The total interest paid will be $214.24
If your credit card balance is 1150 and the minimum monthly payment is 3 percent what is the minimum amount you must pay?
$1150.00 X 3% = $34.50 minimum payment or $1150.00 X .03 = $34.50 minimum payment
What does Minimum payment in your credit card bills mean What happens if pay less than the Minimum payment?
It's called minimum payment for a reason.. and that reason is that you don't have to pay you're full balance.. but you have to pay the minimum payment. NOTHING LESS
What is the minimum payment due on a credit card with a 50000 balance?
Most credit card issuers have moved to a monthly minimum payment due of 4% of the outstanding balance. For a $50,000 balance this would equate to $2,000. Some issuers only require 2% or 3% minimum payments, which would equate to $1,000 or $1,500, respectively. You would need to check with your credit card issuer to determine their particular minimum payment requirements. Check out CreditCards.com/calculators.php to look at different scenarios.
If your credit card balance is 1150 and the minimum monthly payment required is 3 percent What is the minimum amount you must pay this month?
34.50
Can you send credit cards 5.00 per month and do they have to accept it?
Most credit card companies demand a minimum monthly payment of 5% of your balance owed.If you owe $1000 your minimum payment would be $50.You can send any amount you want. However your balance owing will steadily increase. It will only affect your credit rating.If you pay only the minimum payment each month, it will take years for you to pay your bill.
What happens if you pay more than the minimum balance on your credit card each month?
When you pay more than the minimum balance on your credit card each month, you reduce the principal balance. This does not change your interest rate, but over time there will be less interest total on the total decreasing balance. However, to make this work even better, you could also add in what equals one interest payment on top of the "extra" payment, so even more goes to the principal each time not applied to the interest. When you pay off a credit card more quickly, it will positively affect your credit rating.** Even adding $5 to $10 above the minimum+interest can begin to make a dent in your amount owed. But you must pay on time to get any benefit at all from doing these larger or "extra" payments.
Why is it unwise to pay minimum payments on your credit card?
It is unwise to pay minimum payments due on credit cards because the payment will cover only a small portion of the principal amount and more on interest and financial charges.
Jill went on vacation pd for it by credit card at an apr of 22dot9 percent the card requires minimum payment of 2dot5 percent on balance her balance was 8655dot90 round this to nearest dollar?
Minimum payment 2.5 % of 8655.90 = 2.5 x 86.559 =$216 and change
What are some ways credit card debt can be cleared?
Credit card debt can be cleared by making more than the minimum payment each month. For example, making only the minimum payment on a large balance can keep you in debt for several year. Paying extra principal, even if it is only a little bit, will decrease the interest you pay next month. If you continue to make larger payments, your debt will be eliminated in months instead of years.
What is the minimum monthly payment on credit cards?
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