Have you been awed by 0% credit card offers lately? Are you opting to transfer your credit card balance to a 0% interest card? 0% credit offers can be a more-than-ideal solution for those who are searching for new ways to get their finances under control and in the process reduce their overall debt situation.
First and foremost, every 0% credit card offer has an attached terms and conditions sheet which is crucial for you read and understand. In order to earn back the lost interest revenue, the credit lender might charge higher late payment rates, over-the-limit or missed payment fees, which could altogether cancel out the benefits that you are expecting to receive from the 0% interest rate.
It is not uncommon for credit card providers to charge a “transfer fee” when transferring your debt across their account, which can reach as high as 3% of the total debt amount that you owe. If you transfer two or more credit card balances across, you will be charged for each of these transfers making it easy to see how you have quickly surmounted to all the charges.
Also, while these offers generally allow for a 0% interest charge every month, they will occasionally require a monthly “finance charge” to be applied to your account. This can be as low as 5 cents or 1 dollar, but then again, it is very important to analyze the fine print carefully and understand all of their conditions and rules that they are attaching to your new account.
The following are tips to successfully handle your 0% credit card offers:
* Know exactly what you are in for by reading and understanding all of the conditions attached to the balance transfer offer.
* Do not hesitate to ask a lot of relevant questions. Questions like: How long does the 0% interest rate last? Or, how high will the interest rates be once the 0% interest period is over?
* Discipline yourself to pay down the debts. Just because you are still enjoying a 0% interest rate offer does not mean that you should let your debt sit for a few months on your account. Instead, look at it as an opportunity to pay off as much of your credit balances as possible before higher interest rates kick in again.
* Before moving to a new credit provider, talk to your bank and see if they can give you a better deal on your current account. By doing so, the bank may be able to wipe off a few percentage points in your interest rate in order to keep your business.