Don’t Make This Huge Mistake with Statement Credits & Minimum Payments

Bank of America Statement Credit Towards Payment

Bank of America Statement Credit Towards Payment

In the credit card game it is the little things that can kill you. Even if you know what you are doing and know the rules, you are going to make mistakes. Recently I made a stupid mistake, even though I theoretically knew better. For teaching purposes (and to shame myself) I thought I would share my tale of woe to help you my readers avoid the same situation.

The Better Alaska Airlines Offer

Bank of America Statement Credit Towards Payment

A couple of months ago I signed up for the Alaska Airlines Visa Signature 30K + $100 statement credit offer. Since I signed up for this card along with a few others, it took me a few weeks before I began working towards the very modest $1K spend on the card. Before I had been able to spend anything, the first statement had printed with the $75 annual fee as the balance.

Then, I picked up the card rather quickly after the statement printed (disappointed that I hadn’t done it sooner) and spent my $1K to both trigger the 30K bonus and also the $100 statement credit.

So let’s step back for a second and look at the series of events in order so I can highlight my mistake:

  • 7/9/16: The statement prints with a $75 balance, a minimum payment of $25 and a due date of 8/6/16.
  • 7/25/16: $100 statement credit is issued after I hit the $1K spending.
  • 8/6/16: $25 is due at the minimum, $75 at the maximum. I briefly look at the account and see the $100 debit and quickly think it is paid.
  • 8/6/16: Since no payment is made on the account I am charged a late payment fee of $25.
  • 8/8/16: I notice the late payment charge and pay the entire $75 balance.


So was Bank of America correct in charging me the late fee? Drum roll………………………………

YES! Almost all banks have it written into their terms that statement credits apply as additional payments and not as minimum payments on the account. Since I had an additional balance from that $1K spending I did in the next statement period, I was supposed to pay my $75. I knew that, I really did, but in a quick glance didn’t put two and two together. Sigh.

How to Fix It

The first thing you should do when you notice your account is past due is PAY IT! No matter if you feel you are wrong or the bank is, there is no benefit in letting the account sit past due. In this case the entire balance was $75 so I paid it, but if the balance was higher you could pay the minimum payment until the dispute was settled. Either way, there is no reason to leave the account in past due status. That just undermines your conversation with the bank.

A Happy Ending

About a week after I paid the account off (including the late fee and extra $1K in purchases), I decided to hop on chat with Bank of America and explain my error. I explained that I saw the $75 amount due along with the $100 credit and somehow interpreted that to mean the payment was made. Without hesitation the agent waived the late fee.

Over the course of the past decade or so, I have been late (and by late I mean by a day or a couple at most) a few times by mistake and the banks have always waived the fees for me. When you pay your bills on time and are a good customer they will almost always do it. They usually will reverse interest charges as well. Either contact them via secure message or chat to ask. Of course, do this too often and you not only will pay the fees, but will likely not be approved for new cards either.


This experience just reinforces what I already know. First, I will make mistakes and second it isn’t the end of the world when I do it. While it may seem counter-intuitive that statement credits don’t count as payments, I do understand why that rule exists in the scheme of things.  Hopefully my lapse in judgement can help some of you.

Are there any obscure rules/policies you have run across that you care to share? Let us know in the comments!

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