Best Buy Credit Card Payments
Features of each type of Best Buy Credit Cards
Special Promotional financing offers
Calculation of payments and other charges
Features of each type of Best Buy Credit Cards
Best Buy is one of the leading consumer electronics stores in the US. For its clients Best Buy offers three types of credit cards involved with the Reward Zone program the chain started. All types of credit cards have annual percentage rate presented as a sum of the prime rate (the highest bank prime loan rate published in The Wall Street Journal in its Money Rates sections on the last business day of the calendar month proceeding the first day of the billing cycle) and a fixed percentage. Two of the credit cards are powered by HSBC bank and one is supported by Chase.
Best Buy Reward Zone Chase Credit Card
This is a customer credit card which offers annual percentage rate (APR) for purchases of 23.24% up to 25.24% depending on the prime rate changes. The penalty APR is from 26.99% up to 29.99%. The minimal interest charge of this card is $1.50 and the due date is 21 days after closing of each billing cycle.
Best Buy Reward Zone HSBC Credit Card
This customer card is has two types assigned on the basis of the applicant’s creditworthiness. For type A the standard APR for purchases is 24.24% and the penalty APR is 29.24%. For type B the APR is equal to 27.99% and the penalty is 29.99%. This card has also a due date of 21 days after closing of the billing cycle and a minimum interest charge of $2.
Best Buy Reward Zone HSBC MasterCard
This card is offered in three variations depending on the applicant’s creditworthiness. The first one is the Platinum MasterCard which has an annual rate for purchases and balance transfer of 17.99%. The second one is Gold MasterCard with no annual fee and APR of 22.99%. The third credit card is the Gold MasterCard with fee. This card is offered with annual fee of $59 and APR for purchases and balance transfer of 21.74%. As these cards are MasterCard they can be used for different cash advances. For these kinds of transactions the annual percentage rate is 25.99%. The minimal interest charge is $1. There is a penalty APR equal to 29.90%. If a card owner fails to make a payment when it is due or the payment is rejected by the bank this penalty APR will be applied. The cardholders, then need to pay his/her total minimum payment for 6 consecutive billing periods so that the regular APR is applicable again.
How are Best Buy Credit Card payments calculated
The method “Daily Balance” is used to calculate the daily balance for each day of the billing cycle. It is applied for every different balance that the cardholder has. The method of calculating the daily balance has a few stages:
1) The daily balance is calculated using the formula:
Daily Balance = The Balance in the beginning of the day + New charges and fees for that day – any payments and credit. .
2) The next formula serve to calculate the daily rate:
The Daily rate = APR/365;
3) Using the previous two results the interest charge is calculated:
Interest Charge = Daily Balance * Daily rate.
4) After that the sum of the daily balance and the interest charge on it will give the balance for the next day:
Balance at the beginning of the day = Daily Balance for the previous day + Interest Charge on it.
5) The interest charge for the whole billing cycle is:
Interest charge for the billing cycle = ? (Interest charges for every day of the billing cycle).
If the balance from the previous day is paid in full or is $0 there will be no interest charged on purchases. If there is no previous balance or it has been paid in full any new purchases for that billing cycle will start to accrue a finance charge on the first day of the next billing cycle.
Since the annual percentage rate for these credit cards is dependant on the prime rate stated in The Wall Street Journal and this rate is a variable, it is essential to be noted that if the prime rate increases then the APR will increase too, and with it, the total minimum payment and the number of payments it will take to pay off the debt.
Calculating the total minimum payment that the cardholder owes every billing cycle is another very important stage. For cards powered by HSBC bank the total minimum payment will be either $10 or 1% of the new balance + finance charges on it + any late payment fees. For cards supported by Chase the TMP will be either $10 or 2.5% of the new balance or 1% of the new balance + periodic interest charge + any late fees.
It is important to know that banks which support these store credit cards have a policy of payment allocation. Basically this means that when the cardholder makes a payment this payment is allocated to cover any highest APR balances first, then other balances in order of descending APR.
Types of penalty fees
- Late payment fee: Late payment fee is due when the cardholder fails to pay at least the total minimum payment by 5 pm ET on the due date of his/hers billing cycle. An amount exceeding the TMP can be paid at any time. Any payments received after 5 pm ET will be processed and credited as of the next day. For owners of Best Buy HSBC credit card the fee for late payment is dependant on the balance they have. For balances less or equal to $250 the fee is $25. For balances more than $250 the first penalty fee is $25 and if there is another late payment within the next 6 months this payment will be charged with $35 fee. If having a Best Buy Chase Credit Card the penalty fee will be based entirely on the total balance on the day the penalty fee is charged.
- Returned Check fee: This kind of fee is required from cardholders of Best Buy HSBC Credit Cards only. It is $25.00. This fee is due when a check or other kind of instrument is not processed and has to be returned. It is important to be noted that this fee will not exceed the total minimum payment.
- Research fee: This fee is applied to holders of Best Buy HSBC Credit Card when he/she requests issuing of particular documents.
- Reissue fee: If a card owner needs reissuing of a credit card, supported by HSBC bank, he/she needs to pay $5.
- Payment by phone fee: This is a fee that is required if the card owner requests a payment by phone. It is only applied to owners of Reward Zone MasterCard, powered by HSBC.
- Transaction fees: Transaction fees include fees for balance transfers, cash advances and foreign transactions. The are owed by owners of Best Buy Reward Zone MasterCard These fees are shown below:
- A Balance Transfer fee: this fee is due if a balance transfer has been requested. The fee is $15 or 3% of the amount for each transfer (whichever is greater);
- A Cash Advance fee: This fee is added to the normal fee the cardholder will be charged with by the ATM. The Cash Advance fee is either $10 or 5% of the amount, whichever is greater.
- Fee for foreign transactions: a fee charged with every foreign transaction: 3% of the amount for each transaction.
- Security Interest: The security interest is a practice in a lot of banks to ensure that the purchase will be paid off in full or in some circumstances to ensure the right of the bank to repossess the merchandise when the cardholder cannot repay it. It is a certain amount retained with every purchase.
- Insurance and Debt Cancellation: If the cardholder elects any insurance or debt cancellation, he/she authorizes the supporting bank a charge on this insurance or debt cancellation. The charge is based on the average daily balance of the account for the billing period in which the insurance/debt cancellation is assessed.