Can you tell APR from payment?

[ceejay74]

This is an odd (and admittedly idle) question, but I'm interested to know if anyone knows this offhand.

My husband has a CC from the UK. We signed up for paperless banking, but then they switched the security features on their site so that it's impossible for someone with a US phone number to create a new login! The payments are on autopilot so I just wait for it to go through the bank and then use the automated phone system to check the balance.

Anyway, when I started tracking, the card had a 1.24% APR, but I think that was a temporary situation. Especially since after awhile it seemed not much was going to principal. The last regular payment was 65 pounds, and 36.50 went to principal.

Is there any way to calculate the APR from that info? I could get my husband to call them but it's a pain. Plus we're going to pay it off in two or three months anyway.

[simpletron]

take the interest portion of the payment, 65-36.50= 29.5 and divide by the total balance before the payment and then divide by the number of days in the billing period. that will give you the daily rate, multiply that by 36500 will give you APR as a percentage.

example:
assume you have a balance of 3000 and there were 30 days in billing period.

((29.5/3000)/30)*36500 = 11.96% APR

if you don't have the number of the days in the billing period. take the interest, 29.5, divide by the balance before payment and multiply by 1200. this will give you a rough estimate of APR. error: +1.39% or -1.88% of APR. so if you calculated this way that APR was 10%, the true APR is either 10.139% or 9.812%

example 2:
assume you have a balance of 3000.

(29.5/3000)*1200 = 11.8% APR, true APR of either 11.96% or 11.58%

all of this assumes that the credit card uses daily interest like every other credit card that I have use here in the US. but UK CC may be on some exotic system.

[neatdesign]

Instead of playing the guessing game and hoping your calculations are correct, you'd be better off calling the credit card company and simply asking.

I don't know if your UK credit card company is listed here, but try this website to get through to a human being when you call their number: www.gethuman.com.uk

You might also consider asking a UK relative to allow you to use their UK phone number on your account so that you can access your account online. When you call the credit card company, they can update your phone number at that time, which in turn would allow you to create an online profile.

Don't you get electronic statements via email? You should be able to just look at your statements and see what the APR is.

~ Jenney

[ceejay74]

Thank you! That means the APR is between 16.2% and 16.7%, depending on whether it's a 30- or 31-day billing cycle. As I suspected, the low temporary rate is gone.

Ah well, I'll have it paid off by mid-March. Good to know that formula, though!