How can I pay off in full my 0% 4 Months Paypal Credit amount?

[RSV_Ecosse]

Hi all,

I made a purchase for £449 a couple of months ago using the 0% interest for 4 months facility on Paypal Credit. The 4 months period expires in OCtober and I'm now in the position where I'd like to pay the £449 off in full and clear the outstanding balance thus not encurring any interest charges.

I've searched all over the internet to see if there is anything which clearly states how this works but cannot see any info which relates to it. So for example, if I make a £400 payment at the moment using £100 that I have as Paypal balance and £300 from the bank account tied to my account, will that wipe £400 from the outstanding balance of the 0% interest offer, leaving £49 outstanding? 

My fear is that I pay £400 to my Paypal account and all it does is reduces my outstanding overall Paypal Credit balance by £400 and the £449 sat currently as interest free doesn't get touched and remains there. Or will that not happen?

Would really appreciate some guidance on this. Many thanks.

[RSV_Ecosse]

Yeah, this statement was dated 26th August. So let me get this right - From what you have said there, if I make a payment of say £400 right now, it will go towards my promotional purchase expiring in 2 months i.e. the £400 payment will go towards the £449 of the zero percent interest amount which is a 'promotional offer'. Thereafter, I'd have a balance of that promotional offer of £49? But none of the £400 I pay would have gone towards my regular purchase balance of £731?

If that is correct then that is the information I was looking for! I'm not aware of the payment hierarchy and how that works?

[DPCreations]

Correct.

How payments are applied (at least in the U. S.) are on the back page of the PDF statement.  You need to read it extremely carefully to catch the application of payment first to the non-interest promotional payments near expiraton before paying down the interest-bearing parts.

Whatever you pay now will go to the promotional.

You might have an option to specify exactly where the payments go if you want it differently, but you would need phone PayPal Credit for that.  I read is somewhere recently.

[lancelotme]

Is it cocktail hour yet/

I need a drink !

Think FIFO,fist in first out

[DPCreations]

FIFO doesn't work when one mixes promotional pruchases with regular purchaes.  When a promotion NEARS expiration PayPal adds the payment there and allows the generation of more interest on the regular purchase. 

[RSV_Ecosse]

Hi,

Thanks for all the info thus far, its been really helpful and is truly appreciated. 

Another quick question if I may? How quickly does the new balance on the zero percent interest promotional payments show up after a payment towards it is made? Is it instant or does it take a while and sit in a sort of 'pending' state or anything similar?

Also, I've got funds sat in my Paypal balance which I intended on paying towards the outstanding promotional balance. The remainder I intend paying towards the promotional balance using my main bank account linked to my PP account. Will there be any difference in how long it takes for my promotional balance to update if I split it this way, sort of 30% PP balance/70% funds from bank account?

Cheers guys!! 

[DPCreations]

My payments are always from checking account and it takes several days for the entire process to complete.  I nevery really checked to see when the balance updates; just know it takes days to show up from my bank account.  I just don't pay attention to the daily balance details.  When paying from checking, the process is actually a transfer from checking to PayPal and then to PayPal Credit, but the money doesn't make a stop in your PayPal account.  PayPal Credit can't take funds directly from your checkng account.

What I would suggest is make independent payments initiated days appart to make sure there is no confusion.  Just don't schedule payments too close to a due date.

PayPal and PayPal Credit are 2 separate account systems.

[RSV_Ecosse]

Thanks, yeah - that makes sense. I'll pay a few different amounts and schedule them so they are staggered apart. 

[RSV_Ecosse]

Ok, so tried a little experiment. My overall minimum Paypal Payment for September was £44. So last night I paid £49. I expected it to be deducted from my promotional offer balance of £449. But it wasn't. The £49 payment was deducted from my overall Paypal balance. My promotional offer balance remains at £449. I'm not sure why. Is it to do with the billing cycles remaining before my promotional offer elapses? The promotional offer ends on 20th October. I thought that in that case, if I made a payment on 1st September (last night) then by all rights, it should have came off the promotional offer balance? How many 'billing cycles' is it until 20th October? I'm confused again!!

My overall Paypal payment of £44 for September wasn't due until the 20th September. Since I paid £49 last night it now shows that I have 'No payment due'. What would happen if I paid another £49 right now, which balance would that money be deducted from? It's so frustrating, I've got cash sat here that I desperately want to pay off my outstanding promotional offer balance with but there doesn't seem to be a way to do it!!! 

[sharpiemarker]

In the agreement, the credit of the Minimum payment or less will first go to pay billed Monthly Plan Payments on any Easy Payments Purchases, then billed interest, then billed fees, then the principal balance, and then any other amounts due.

BUT, if you have Deferred Interest balance that will expire in 2 months, after crediting your Easy Payment Purchases for the month, what is left over will go to your Deferred Interest Balance.  

So, if you don't have any Easy Payments Purchases, then the Deferred Interest Purchases mAy be credited first.

Note that this is from the US PayPal Credit agreement.  

I can't even view the UK one because it tells me to log in which will probably just take me to my summary page no doubt.  You can view how payments are allocated by clicking Legal at the bottom of the page.  There is a section for PayPal Credit on the general user agreement page.

[DPCreations]

You don't have an easy payment plant set up.

Don't be so concerrned with the details.    There is no need to pay off your pormotional balance early; stash the money into a savings again for a tiny bit of interest until payment is due.

According the payoff hierarchy, PayPal MAY put the money towards the promotional balance expiring within 2 months; this allows them to allocate differently when it is better for them.  If you have excellent history with promotional, there's no benefit to allowing it continue longer; you are low risk, so PayPal wants to keep you for the promotional rate.

One caution: If you try to make too many payments that might seem to be an attempt to circumvent some rules, you may have a bigger problem.  So, just make a payment for the month and move on; don't try to test the system.

If you want specific payment allocation you need to phone PayPal Credt.