Credit card in credit

A question about : Credit card in credit

Hi MSE members

I'm in a situation (partly of my own making) and would appreciate some advise

I had a credit card with X and there was some balance on it
I got a new credit card with Y and transferred balance from it to X. It helped that Y offered me a long interest free period.

Good so far, the balance transfer cleared the balance I had on my card with X and also put me in credit by few K's.

When i requested X to refund the credit to my bank account, they refused and said they will only return the credit to where it came from i.e. back to Y ( I did tell them openly where it came from....perhaps a mistake :-( )

So my question is, is it legal for X to force this on me - as far as my understanding goes it is not X's problem where the money came from, it is mine really whether I borrowed it from someone or some other bank. So really they need to be refunding it to me and not forcing me to accept that they will only refund it to the source.

I was disappointed and closed my card with X and the account is still in credit though. X have stated that once I confirm with some proof of the origin of the money in credit they will send the money in credit back to Y.
I can provide X with the latest card statement from Y and it will be sorted for sure but I would have then wasted the bal.tfr fees I paid to Y in the first place.
So I'm now trying to figure out how to best handle this situation.
Thanks. D

Best answers:

• So can we assume you requested a balance transfer that was greater than the actual balance because you trying to get some cash?
  I suspect X is correct, they only have to refund back to Y. It would have been against the T&Cs to deliberately put the credit card into a positive balance.
• Accept the overpayment back to 'Y' and you are no worse off, I don't see what the problem is.
  As TadleyBaggie says it just sounds like you aren't going to get cash off the new card via 'X'.
• Well that's what I thought so too...worst case scenario. I had already spoken to Y and they are happy to refund the fees as long as I do another balance transfer to somewhere for the same amount......so won't be much worse off at the end of it all.
  I was in a similar situation with X three years back when I bought my first house and they did not have any problem then to refund credit balance to my bank account.....so looks like things have moved on since then and banks are tightening up on 'stoozing' really !
• Just remember though that the transferred balance is paid first so interest for any purchases is allowed to accumulate unless you pay the entire balance or transfer it to another 0% deal.
• For the benefit of the Forum members, I'm sharing how this ended up getting sorted
  X - Tesco Credit Card, been with them for 3+ years. Spend Ј1000+ every month and pay in full every month
  Y - Barclaycard - opened account 1month ago
  So X returned the money in credit to Y
  Called Y and asked them nicely if they can credit the returned money back to my bank account which they did within 2 days of asking.
  Score: Barclaycard 1, Tesco Credit Card 0
  Results : Closed Tesco Credit Card account
  Whilst what I tried may have been against X's TnC's, the whole point of credit card account balances should not be in credit makes no sense to me, especially for 3+ years I have been paying in full, so it was not like they were going to make any high interest payments out of me by stopping me putting my account in credit. For better customer service sake ideally they could have refunded the credit balance and said it was one off and they are doing it for good will blah blah and everyone was a winner.
  In anycase kudos to Barclaycard who helped me out a great deal and saved me 100Јs in the process.
  I'm now off to buy myself a nice NEW Mercedes C Class coupe which is going for cheap in the market as its end of line and loads of deals available...hehehehe
  And hey, if you did not agree with anything I said....it's ok, I agree with you too, peace.
• As far as regulation goes, lending is a different activity to deposit taking. (In the past they even had separate regulators.) For this reason, CCs are not permitted customers to run positive balances in the normal course of business. This is reflected in the T+Cs - you are not supposed to put the account into credit.
  Having said that, just because one party breaks T+Cs doesn't mean that the other party is free to do what they like to remedy the situation. In this case, if the T+Cs didn't state that they could return a positive balance to the sender then I don't believe they are entitled to insist that they do this. They should refund the money to you, subject any money laundering checks and fees that are provided for.
  But glad it worked out though.