Grace Period

Your Credit Card - Understanding the Interest-Free Period on Purchases

The Interest-Free period (also called grace period) is the time when you are not charged interest on new purchases.

Balance Transfers, Checks, Cash Advances and Overdraft Advances do not have an interest-free period.

How do I avoid Interest Charges on purchases?

 

You pay no interest charges on purchases if you pay your New Balance as shown on your statement every month by the due date and time.

You pay interest on purchases if you:

  1. Do not pay your entire balance in full every month, or
  2. Are in your interest-free period, but you make only a partial payment.

For example:
If you make $1,000 in new purchases, but make a partial payment of only $700 by the due date and time, you do not pay interest charges on the $700, but you do pay interest on the remaining $300. This occurs because you only avoid interest charges when you pay your entire balance in full by the due date and time.

Balance Transfers, Checks, Cash Advances and Overdraft Advances do not have an interest-free period. This means that you pay interest from the date of these transactions until they are fully paid.

If you have any balance on your account (including 0% APR balance transfers) that you do not pay off in full, you will lose your interest-free period on new purchases and you will be charged interest on new purchases.

For example:
You transfer a balance or write a check for $600 at a 0% APR for 12 months. Then you make $300 in new purchases which brings your total balance to $900. In this example:

 
  • You would be charged interest on your new purchases ($300) if you do not pay the entire balance of $900 by the due date and time.
  • You would NOT be charged interest on your $600 0% APR Balance Transfer for the 12 month offer period.