What everyone always fears with 0% balance transfers happened to me after 8 months. A late payment triggered a loss of the 0% promotional interest rate, added a late fee, along with finance charges on one of my cards. Even worse is I imagined this would cascade to my other cards also. In January, I leveraged three of my credit cards to pay off the balance of my car loan for about 22,000.

Back in June, we decided it was about time to start consolidating our bank accounts or at least have them all in one location. This was all for the simplification of accounts and less upkeep in terms of inter-account transfers and overdrafts and so on. Previously my strategy was to save 1/12 of the balance into FNBO Direct account, then have each card autopay the minimum payment from this account. I had my google calendar set up to send me an email alert a few weeks prior to the final due date to remind me to pay off each card. I had everything automated and proven to work.

We decided to switch to mvelopes system for tracking our budget and expenses though, which unfortunately doesn’t support FNBO Direct website. Since the savings rate is ridiculously low anyway, I decided it wasn’t worth the risk to keep paying the minimum and have a $20k credit card debt. I made a lump sum payment to pay off my Amex card with the balance in FNBO (previous post). I then set the automatic payments on the two remaining cards to equal amounts to pay them off a month prior to their due date. Unfortunately, the autopayments don’t start immediate, which I imagine is more of an excuse to try to tag on a late fee rather than an actual need for 6 weeks processing time. Knowing this I set up a reminder to email me on the due date to ensure the card was paid.

On the due date I logged on to Citibank, and attempted to make a payment. The website said I couldn’t set one up because there was a payment pending. I assumed that meant the autopay would work for the day, decided not to call to verify. That was my biggest mistake that could have prevented a lot of hassle.

I checked the account the next day, only to see some finance charges and a late fee added to my account. I called , explained my situation and mentioned their very misleading email which states “your autopay is set up”. The customer service rep told me he would help me get the late fee reversed then forward my case to the credit department to get the finance charges “taken care of.” After speaking with him, I was satisfied, and made my scheduled monthly payment over the phone.

A few days later I get a letter in the mail explaining that my promotional rate has been lost and my purchase APR was being increased from 5.99% to 25.99%. let’s just say, I was more then just angry. So much so that I knew I had to wait a day to call so I could play nice in order get this all fixed. I did not want to get screwed in the end and have more interest to pay, so I immediately paid off the card in full, finance charges in all.

The next day I kindly explained to the lady on the phone how I was mislead by their confirmation email, and I tried to make a payment. Surprisingly, with only 5 minutes of talking she apologized, removed the finance charge, and reinstated my promotional rate. Oh how I love Citibank. Regardless, it forced me to pay off a card and have a scare I never want to have again. A lesson to all with 0% balance transfers:
1. Take all precautions for all payments!
2. Play nice if something does go wrong.

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