Credit Card Companies doing away with Grace Periods

[maggiespice]

I have heard and read that some Credit Card companies are beginning to do away with Grace Periods! Would your issuer not let you know if this is the case? I get that you would quickly find out when you look at your statement and realize that you have this massive interest fee, but would it not be right for your CC company to warn you first?

I mean I put all my monthly expenses on my CC including food, gas, and anything else I can possibly put on and this usually totals up to $1000-$3000 every month! I pay it off each month and then collect the points and at the end of each yearly cycle they end up owing me hundreds of dollars! So it would be upsetting if this happened with my CC company. Believe me, it would happen only once and then the good times would end.

[Natalka]

If there were a change to a particular card you have, you would have gotten notification with your statement. I know lots of times people just throw away the inserts, though, and don't check.

[Ciel]

The only thing I know is that RBC cards have to show at least one activity within 90 days (3 months) or the bank can cancel the card as being inactive. If the grace period were to go, chances are I'd get Mom to switch to another bank cc product. I do read her statements from time to time esp. when her recollection of a charge is at variance with what the statement shows.

[Tommycoupons]

No! Credit Card grace periods are regulated by the Government and have to be a minimum of 21 days except for cash advances and balance transfers.

http://www.fcac-acfc.gc.ca/eng/resou...escarte-2.aspx


Interest-free grace period

You can benefit from an interest-free period, also known as the grace period, when you make purchases with your credit card. To do so, you must pay the balance in full by the current month’s due date. The grace period on new purchases officially starts on the last date that is included in your monthly billing period.
The grace period on new purchases must be a minimum of 21 days as long as you pay the full balance by the current month’s deadline. The 21-day grace period on new purchases applies even if an outstanding balance has been carried forward from the previous month.
The interest-free period does not apply to balance transfers or cash advances. With these transactions, interest is charged right away.

Example:
Rajiv made a new purchase on May 5. His statement covers transactions he made between May 1 and May 31.

His statement shows the due date for his payment as June 21. This means that he will have a 21-day grace period from the last date included in the statement (May 31), provided that he pays the balance in full by June 21.


Avoiding interest charges

You will never have to pay any interest if:
1. you always pay the full amount owing on your credit card by the payment due date;
AND
2. you don’t use your credit card to take cash advances or make cash-like transactions, such as a wire transfer or money order.

How interest charges are calculated


If you don’t pay the amount owing on your credit card in full by the due date, you will pay interest, which increases the cost of everything you have charged to your card.

Transaction type	How interest is calculated
New purchases (purchases that appear on your monthly statement for the first time)	You are not charged interest on the first monthly statement.
Previous purchases (purchases that were listed on a previous statement where the full amount owing was not paid by the due date)	You are charged interest back to the date you made these purchases until you make a payment that covers the full amount of these purchases.
Cash advances, balance transfers and “cash-like” transactions	You are charged interest from the date you made the cash advance or balance transfer until the date you repay the total amount in full. You don’t benefit from an interest-free period on these transactions.

[tjthemanto]

You can pre pay in advance too. I usually do that, if I am going to take a cash advance on the CC, as the interest starts from day 1, no grace period on that.

Usually I only do this if I am travelling outside Canada and I have to withdraw some money from the foreign ATM. I hate using my debit card outside Canada.