Balance transfer credit cards are a perfect choice for people who want to cut down the interest bill on the current credit balances. You simply open a new 0% balance transfer plastic and ask your new credit company to shift your debt onto it. The saved interest is money in your pocket. However, before you rush off to search for your ideal balance transfer credit card, pay attention to the traps you could fall into.
When you are looking at 0% introductory rates, you should understand that they do not last forever. The credit card companies offer promotional low APR for up to 15 months. Then you will switch to a regular interest rate, which will be higher. Thus, pay attention the length of introductory period. It goes without saying that the longer 0% offers last, the better.
If you have more than one debt, you can consolidate them on one balance transfer credit card. It will make financial management simpler. However, pay attention to your credit limit - if it is not high enough to accommodate both debts, you will not be able to transfer your balance fully. Thus you will have more plastics than before. It is not your aim, right?
Typically, credit companies do not allow make balance transfers between their own plastics. So, if you have a debt on, for example, Chase Bank Platinum Visa, then you won't be able to transfer your balance on another Chase credit card. But you can always look for the best credit card offers from other credit companies, for example Discovery or American Express.
While choosing a suitable plastic, pay attention to balance transfer fee. This one-time fee can range from 2% to 5% of the value of your debt. Sometimes credit card issuers charge a settled amount of money, for example 50 dollars. The second variant can be more beneficial if your balance is large.
Although you can find credit cards which offer 0% interest on both balance transfers and purchases, these are the exception rather than the rule. So check all the features of credit card offers. If they come with high interest rate on purchases, then choose another plastic for making purchases.
Balance transfer credit cards can come with other benefits, for example no annual fee or a good point rewards or cash back program. If you often travel for business or personal purposes, choose frequent flyer or hotel rewards program. If you like going to the cinema or eating out, apply for a plastic with entertainment rewards. Whatever balance transfer credit card you choose, keep in mind that they are targeted at people with good or excellent credit.
Zero APR balance transfer credit cards are a great solution to shift your debt and save on interest if you know that you will pay it off within the introductory period. If you make on time payments and don't max out your credit limit you will comply with the terms and conditions of credit card agreement. That means your APR will remain zero during your introductory period.
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