Its called a "Grace Period" If you do not pay your balance in full by the due date your grace period ends. This means that you have to pay interest on the purchased amount from the day it is made. *This is why when you do a balance transfer the card should be put in the Sock Drawer until the BT is paid off.* In order to restore the grace period you must pay the balance in full and the grace period will start during the Next Payment Cycle. Lets Assume: 1. Cycle starts on 1st. 2. Balance Transfer $110 on the 10th. Statement cuts on the 1st and Due date is the 20th. - you make the minimum payment of $10 Balance now is $100 3. You make a purchase of $50 on the 10th after the statement from above **Since you have a balance** of $100 from the previous statement and a new purchase of $50.00, when the next statement cuts you will have to pay interest according to the terms on the $50.00 portion. In order to get the grace period back you will have to pay in full and wait for the next cycle In case I did not explain it well here is a quote from creditcards dot com website: > **The cost of carrying a balance** > This is because carrying a balance of > any size into the next billing cycle means there is no grace period on > your purchases during that cycle. The card company will begin charging > interest on your purchases the day you make them. So leaving even $1 > in unpaid balance on your card will cost you considerably more than > the measly finance charges on that dollar. > > To see how this works let's consider an imaginary card user named > Sally. She's so happy she got a new credit card that she charges > $1,500 in purchases on the first day of her monthly billing cycle. > After the cycle ends, Sally pays off the entire $1,500 by the due > date, wiping her balance to zero. As a result, her purchases during > the second month are also free of interest. She has used her grace > period wisely to avoid finance charges. > > What happens if Sally leaves just $1 of her balance from the first > month unpaid? That $1 begins to accrue interest starting the first day > of the billing cycle. It's just $1, so the interest is not a big deal > -- but because she used up her grace period without paying off her entire debt, her new purchases during the second month also start to > get hit with interest charges immediately, starting the day of the > transaction. Assuming she makes another $1,500 in purchases at the > average annual interest rate of about 13 percent, that means $16 in > finance charges for the month. If Sally repeats this pattern, the > interest costs add up to $190 over the course of a year.