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Citi Card applying credits but not debits to previous statement balance

12,814 August 31, 2022 at 04:12 PM
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Last Edited by MadPup September 12, 2022 at 04:24 PM
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I've been using credit cards since the dark ages but learned something new today...

Say, for instance, your CC billing cycle ends on the first day of each new month and your auto-payment date is set for the 15th of the month. Any credits that come in before the 15th are applied to the statement balance for the previous month. As an example...

My statement for July is $1000 and on the 4th of August I buy something for $700. I return the item immediately and get a refund that hits my account on the 10th of August. On the 15th of August my auto-payment triggers for $300 even though my balance at that time was $1500. So on August 16th I'm looking at a balance of $1200 and wondering WTF is going on that it's so high mid-month? Confused I had to get this explained to me by my CC company (CitiCard - Costco) who told me that all credit cards work this way.

Meanwhile my credit score got dinged because of the increase usage of credit caused by this issue.
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llenrad
09-01-2022 at 04:49 AM.
09-01-2022 at 04:49 AM.
I had a Capital One credit card.

If I made a payment before the due date, it came off the current charges and full statement balance was still due on the due date.
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MadPup
09-01-2022 at 12:09 PM.
09-01-2022 at 12:09 PM.
Quote from llenrad :
I had a Capital One credit card.

If I made a payment before the due date, it came off the current charges and full statement balance was still due on the due date.
Interesting. So basically they were bs'ing me about it being the way all credit cards worked.
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pur | Staff
09-03-2022 at 06:37 AM.
09-03-2022 at 06:37 AM.
I stopped using too-big-to-fail Citibank's autopay because other payments would result in a negative balance, but your scenario is also unexpected...
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Last edited by pur | Staff September 3, 2022 at 06:46 AM.
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Angry
09-06-2022 at 11:17 AM.
09-06-2022 at 11:17 AM.
Quote from llenrad :
I had a Capital One credit card.

If I made a payment before the due date, it came off the current charges and full statement balance was still due on the due date.
I'm not sure what card you have but I have a standard Quicksilver and payments or credits prior to the due date, and after the statement balance has been produced, get applied to the statement balance. MadPup's experience is correct.

Quote from MadPup :
Interesting. So basically they were bs'ing me about it being the way all credit cards worked.
No - that is how all credit cards work unless stated differently in the cardholder agreement. Whether the balance is low one month and high the next should be irrelevant - if you spend $700 on top of your $1K balance then you should expect to pay $1700 total. You shouldn't call customer service and waste their time with this when there are other customers with real issues that need to be addressed. When the previous statement was $300 and you expected it to be $1K did you think the financial institution was just forgetting or giving you $700? Did you then go out and spend that $700 thinking it wouldn't be due the following statement and then you tried to blame the financial institution? Just boggles my mind why you would waste their time with that phone call. Keep a spreadsheet of your expenses correlating to your chequing account, or take it a step further and log your individual expenditures.
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llenrad
09-07-2022 at 07:03 AM.
09-07-2022 at 07:03 AM.
[QUOTE=Angry;157426057]I'm not sure what card you have but I have a standard Quicksilver and payments or credits prior to the due date, and after the statement balance has been produced, get applied to the statement balance. MadPup's experience is correct.

I had the Capital Rewards card. If I made a payment before the due date, it came off the current charges. Statement due date was still due on the due date.
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NYExcuse
09-07-2022 at 09:43 AM.
09-07-2022 at 09:43 AM.
[QUOTE=llenrad;157441444]
Quote from Angry :
I'm not sure what card you have but I have a standard Quicksilver and payments or credits prior to the due date, and after the statement balance has been produced, get applied to the statement balance. MadPup's experience is correct.

I had the Capital Rewards card. If I made a payment before the due date, it came off the current charges. Statement due date was still due on the due date.
That's absolutely not true and doesn't make any sense. How would you pay early then?
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MadPup
09-11-2022 at 10:03 AM.
09-11-2022 at 10:03 AM.
Quote from Angry :
When the previous statement was $300 and you expected it to be $1K did you think the financial institution was just forgetting or giving you $700? Did you then go out and spend that $700 thinking it wouldn't be due the following statement and then you tried to blame the financial institution? Just boggles my mind why you would waste their time with that phone call. Keep a spreadsheet of your expenses correlating to your chequing account, or take it a step further and log your individual expenditures.
Living up to your username I see. Smilie

It happened like this...

I got an email on the 1st of the month saying that my statement was ready and that it will be paid automatically on the 15th. I reviewed the statement and it looked good. On the first of the next month I got a new statement but this time it's way higher than expected. I challenge anyone to look at that statement and easily figure out why. The only obvious clue is that on the 15th of the month the auto-payment was for less than expected. It's still not obvious to me why credits are applied to the payment amount yet debits are not. I think it's fair to call customer service to ask for clarification (my first call in years) because that's what they are there for. It even took the guy 5 minutes to figure it out so it's not like it was a "duh!" question.
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Last edited by MadPup September 11, 2022 at 12:17 PM.

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migdigital
09-11-2022 at 04:46 PM.
09-11-2022 at 04:46 PM.
Based on the Thread Detail, the time line would be like following as my guessing goes:
Quote :
End of July Balance : $1,000
08/04: Purchase $700
08/10: Return Amount in the account -$700
08/15: Auto Payment Pay $300
(July Balance $1,000 - Credit Amount -$700)
08/15: Account Balance $1,500
08/16: Account Balance $1,200
I think the credit card system calculating the balance as of date of payment has error. Because it seems it is taking any credit amount as of date of payment against the last balance statement.
To consider any credit amount, it is not counting the purchase for same amount was made in between.
But at the end, if your balance as of 08/16 all the amounts are accurate and shows correctly in the statement as of end of August, and you don't have to pay interest fee, it should be fine.
To your question, I learned that usually the processing credit card transactions is not actual real time and some time need to wait and see from couple of days to next statement.
Hope it help.
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MadPup
09-11-2022 at 06:11 PM.
09-11-2022 at 06:11 PM.
Quote from migdigital :
Based on the Thread Detail, the time line would be like following as my guessing goes:

I think the credit card system calculating the balance as of date of payment has error. Because it seems it is taking any credit amount as of date of payment against the last balance statement.
To consider any credit amount, it is not counting the purchase for same amount was made in between.
But at the end, if your balance as of 08/16 all the amounts are accurate and shows correctly in the statement as of end of August, and you don't have to pay interest fee, it should be fine.
To your question, I learned that usually the processing credit card transactions is not actual real time and some time need to wait and see from couple of days to next statement.
Hope it help.
Yes, your summary is correct. And yes, it all works out in the end but there is something funky and not at all logical happening. The only ways to avoid this happening is to pay your statement balance on the same day the statement is published... or avoid doing any returns until after the payment date.

And BTW, I forgot to mention that my credit score got dinged because of the increase of credit usage caused by this issue.
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Last edited by MadPup September 12, 2022 at 04:22 PM.
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Dr. J
09-14-2022 at 11:02 AM.
09-14-2022 at 11:02 AM.
Not sure if all CC's do that but some definitely do.

For example, statement closes on the 30th -you go out, buy a $1000 TV then immediately return it - the $1k credit (return) is "counted" as a payment of sorts against the prior statement. In the end, it will all wash out because the $1k credit will be balanced out by the $1k purchase (so you'll get the credit in the prior statement but then owe $1k the following statement).
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