USAA Credit Cards--Cash Withdrawals

[Sandra B1944]

I recently put the wrong card in an ATM machine and withdrew $200. I realized almost immediately that I had used my USAA credit card instead of my debit card. Knowing that on cash withdrawals on your credit card they charge DAILY INTEREST on that amount until it's paid off, I immediately transferred $200 from my USAA checking account to met USAA credit card, thus immediately paying back the cash withdrawal so as not to incur daily interest on the $200 (the credit card regular interest is bad enough). In looking over my credit card statement, I noticed that I was being charged interest on purchases and on CASH WITHDRAWALS! I called USAA and they informed me that there was n way to separate payments--in other words my cash advance payback was logged in as a regular payment against purchases. This is not right. I will be charged this cash withdrawal interest until the entire credit card balance is paid off. I'm very disappointed with USAA. Ripping off veterans and service personnel in this way. It's getting to where they're no better than Bank of America! And that's BAD. Just seems to me that if they can charge separate interest for cash withdrawals and keep up with it, you should be able to pay off cash withdrawals separately and save some interest. You should be ashamed of yourselves USAA, you really should. I thought you were different.

[Briana Hartzell USAA]

Dear Sandra,

Thank you for sharing your experience here in the community. I have sent your comment to a banking expert to further research and reach out to you personally. Please keep us updated here in the community about the outcome! Thank you.

[Sandra B1944]

Thank you for replying to my query.  The $218 I paid (on he same day within an hour of the mistaken withdrawal) was not a payment on my card.  My card had already been paid for that month.  In fact, I overpaid my account.  The next month I overpaid my account to the tune of $1,000 and was still being charged interest on the cash withdrawal of $218. And, I must say, I don't care what the practices of other financial institutions are.  USAA is my bank and I have always had a wonderful relationship with them.  USAA has always been different, and the day that changes is the day I take my business elsewhere.

i have spoken over the phone to a bank representative.  We had a great conversation.  This is the question I would like asked by the powers that be:  iF it is possible to separate interest on purchases from interest on cash withdrawals as far as interest charges go, then there should be a way to pay them off separately, without incurring all that interest.  It's being passed up the line for discussion.

[Briana Hartzell USAA]

Thank you for your update Sandra.

[727]

Almost without fail at every bank in the world credit card payments are split up to pay in order:

1) Past due amonuts

2) Current minimum payment

3) balance with the highest interest rate

This is the way that USAA Master Card operates (and I must assume all its other cards), Here is the disclosure. (see the top of page 15 for the order in which payments are credited). 

So as an example if your balance is $1000, your minimum payment is $50 and you have the cash withdrawal of $200 which has the highest interest rate your payment would be broken down this way:

$50 to minimum

$150 to cash withdrawal

So you would still have $50 of the cash withdrawal hanging around accruing that high interest rate. 

If they didn't apply the payment in this way let them know and they'll fix it.   Check your specific disclosure for your card, but I bet they're all the same.  Minimum and then anything above that goes to highest rate first. 

That seems only fair, if they applied it to the lowest rate you'd be paying interest on the high balance for a long time if you only made the minimum payments. 

[Bobbi45]

yeah this is really disgusting olicy.

[Ngrothouse]

This literally just happened to me except I took out 2grand for a down payment!!! I've slowly starting banking everything with usaa because I thought they took care of veterans. But the fact that a quick simple mistake can cost you $80+ of your own money! At least have a simple warning message that says "hey idiot" you're not withdrawing your own money. I can't ever see meeting a credit and checking card with the same company again

[USAA Social Service]

Ngrothouse - I regret hearing you had this experience, but appreciate the feedback. Your comments have been shared and will help improve future service. Thanks for speaking up. - Jason