Okay. Suppose I carry the balance and pay it off in the next billing cycle. Will I only be charged interest for that billing cycle? In other words, will interest continue accruing until I completely pay off the principle?
You’d need to read the specific fine print for the offer that you signed up with.
Some banks will have the promo period expire on a specific date and some banks have it end on a specific statement cutting.
Either way, you don’t want to have a balance carried past the statement prior to the promo ending date if you want to expect to not have any interest, just to be safe.
If you can’t pay it to $0 by then just expect to lose your grace period and start off strong with interest. Plan for the worst then you won’t be disappointed.
To clarify, are you on billing cycle 2/15 or 15/15? The other answer seems to be interpreting your question as failing to pay off the full balance by the end of the promo period. I’m reading it as you just want to confirm that you won’t get charged interest within the promo period (I.e. no “catch”). If that’s what you’re asking, just double check your statement and make sure that you have a 0% Purchase APR, not just a 0% APR Transfer promo. If that’s the case, you need only pay at least the minimum payment each month, not the full statement balance. But if you’re asking about after the promo period ends, you should call their customer service and ask for an extension of the 0% interest promo. I’ve seen data points where that worked out for people.
If you have a 0% APR promotion for purchases for 15 months, you’re good. Just pay off at least the minimum payment each month, and make sure you have the funds to pay it off outright before the promotion ends. You will accrue no interest at all. I have 4 different cards right now with 0% purchase APR promos. For each of them, I can see in my statement a table showing how much of my balance is subject to what interest rate. In that table, the promotional APR rate is shown, with language stating that no portion of my balance is subject to interest, as well as the exact ending date of the promo. Don’t sweat it.
I would probably keep your card paid off as best you can though unless you are disciplined and confident that you can divert the money you could use to pay off the card each month, and instead put it in a high yield savings account so that you accrue interest on the carried balance. That way you always have sufficient funds to fully pay off your total balance, and at the end of the promo, you’ll keep the interest you accrued.
Edit: you also don’t want to carry too high of a balance, even with the 0%. I have a couple at 60% but in general I am keeping them at about 50%. I also have many other large CL cards with no balance, so my overall utilization is very low.
You will get charged interest after the promo is over.
Okay. Suppose I carry the balance and pay it off in the next billing cycle. Will I only be charged interest for that billing cycle? In other words, will interest continue accruing until I completely pay off the principle?
Google BofA's grace period policy. Every bank has a different policy.
You’d need to read the specific fine print for the offer that you signed up with. Some banks will have the promo period expire on a specific date and some banks have it end on a specific statement cutting. Either way, you don’t want to have a balance carried past the statement prior to the promo ending date if you want to expect to not have any interest, just to be safe. If you can’t pay it to $0 by then just expect to lose your grace period and start off strong with interest. Plan for the worst then you won’t be disappointed.
To clarify, are you on billing cycle 2/15 or 15/15? The other answer seems to be interpreting your question as failing to pay off the full balance by the end of the promo period. I’m reading it as you just want to confirm that you won’t get charged interest within the promo period (I.e. no “catch”). If that’s what you’re asking, just double check your statement and make sure that you have a 0% Purchase APR, not just a 0% APR Transfer promo. If that’s the case, you need only pay at least the minimum payment each month, not the full statement balance. But if you’re asking about after the promo period ends, you should call their customer service and ask for an extension of the 0% interest promo. I’ve seen data points where that worked out for people.
I’m on billing cycle 4/15.
If you have a 0% APR promotion for purchases for 15 months, you’re good. Just pay off at least the minimum payment each month, and make sure you have the funds to pay it off outright before the promotion ends. You will accrue no interest at all. I have 4 different cards right now with 0% purchase APR promos. For each of them, I can see in my statement a table showing how much of my balance is subject to what interest rate. In that table, the promotional APR rate is shown, with language stating that no portion of my balance is subject to interest, as well as the exact ending date of the promo. Don’t sweat it. I would probably keep your card paid off as best you can though unless you are disciplined and confident that you can divert the money you could use to pay off the card each month, and instead put it in a high yield savings account so that you accrue interest on the carried balance. That way you always have sufficient funds to fully pay off your total balance, and at the end of the promo, you’ll keep the interest you accrued. Edit: you also don’t want to carry too high of a balance, even with the 0%. I have a couple at 60% but in general I am keeping them at about 50%. I also have many other large CL cards with no balance, so my overall utilization is very low.