| The intense competition among credit card | | | | balance you transfer from other credit cards, |
| companies has squeezed their creative brains | | | | which is subject to the low rate offer, while |
| hard, as they try to come up with innovative | | | | new purchases which may accrue interest at a |
| features on their various credit cards. One | | | | higher rate will remain untouched by your |
| of the most attractive - and substantive - | | | | payments. However, there are cards that offer |
| features invented by the credit card | | | | the low rate for both transfers and new |
| companies have been the low-rate credit | | | | purchases, which is more advantageous to you. |
| cards. | | | | |
| | | | Allowable amount to transfer. Most credit |
| It is a smart move to take advantage of these | | | | card offers allow transfer balances up to |
| cost-saving credit card offers. Potentially, | | | | your credit limit, which is great. This can |
| you could actually get the bulk of interest | | | | be a little tricky, though, because they |
| savings from these low-rate credit card | | | | often do not specify exactly how much you can |
| offers, especially when you are trying to | | | | transfer. It's tricky because it is possible |
| manage your credit card debt. Indeed, there | | | | for you to go over the credit cards credit |
| are people who would advise that you jump | | | | limit if there are transfer fees and other |
| from one credit card to another, taking | | | | charges to be paid, and if you do go over |
| advantage of the 0% apr credit card | | | | that you will get hit with an over-limit fee. |
| introductory offers and save yourself a lot | | | | Discuss this area thoroughly with the account |
| of money in interest charges. It would be | | | | representative to be certain you don't break |
| like getting an interest-free loan every | | | | any rules. Remember, if the bank thinks it |
| time. | | | | can charge credit card fees for something, |
| | | | they will. |
| However, as attractive as such offers may | | | | |
| seem, it would not hurt to thoroughly | | | | Balance transfer fees. Now most balance |
| investigate the finer details of the credit | | | | transfer offers do not really impose transfer |
| card terms. The credit card companies, after | | | | fees. Just double check to make sure; read |
| all, are there to make money, so why should | | | | the fine print carefully. There could be |
| they be giving away their chance to make | | | | transfer fee schedules based on the amount |
| profits with these 0% apr credit card offers? | | | | transferred, which could be something like: a |
| Being in the business of lending money, | | | | flat minimum fee for any amount; a 2% fee on |
| credit card issuers earn money by charging | | | | the amount transferred; or, a maximum fee to |
| interest on credit card balances. | | | | serve as a ceiling. It is not saying that |
| | | | credit card fees are automatically onerous, |
| It would be prudent, therefore, to check for | | | | but you must know so that you can calculate |
| hidden costs in these attractive offers | | | | if indeed you will save money when comparing |
| before you apply for a credit card. Prudence | | | | the credit card fees to what you currently |
| requires that you study and understand the | | | | are paying. |
| entire offer. Despite a possible distaste for | | | | |
| it, you should read the credit card terms, | | | | Different rates for different amounts |
| the back of the offer, and all of the fine | | | | transferred. There may be a varying schedule |
| print. | | | | of rates for different amounts transferred. |
| | | | This could be present in the credit card |
| You should study these conditions every time | | | | offer letter, but then again, it may not. |
| consider new credit cards. It's not that you | | | | Some banks may graduate their interest rate |
| begrudge the credit card companies the right | | | | such that the bigger the amount transferred, |
| to impose interest and credit card fees; it's | | | | the lower will be your rate. For instance, |
| just that you would not want any surprises | | | | amounts below $3,000 will be at 8.9%, $3,000 |
| and would prefer to get the better end of the | | | | to $4,999, 7.9%; and over $5,000, the |
| deal. Let us look at some of these details. | | | | interest is 6.9%. Again you need to know this |
| | | | to calculate the amount you will save on the |
| Interest rate. This will always be the most | | | | credit cards. |
| important factor when evaluating credit | | | | |
| cards. You will have no problem finding the | | | | Late payment condition. You should really be |
| nominal rate because it is usually printed in | | | | careful with this condition imposed on credit |
| big bold type in the credit card offer | | | | cards. The advantages of the low-rate credit |
| letter. The long and the short of interest | | | | card offer could suddenly terminate and end |
| rate is this: if you want a balance transfer | | | | up costing you hundreds of dollars if you do |
| as a means to save money, you'll have to make | | | | not read the terms and conditions. Contract |
| certain that your current rate in your | | | | provisions like this usually go to the |
| existing credit card is significantly higher | | | | superfine print area, and could read |
| than the interest rate in the new offer for | | | | something like, "However, if a minimum |
| credit cards. While other considerations | | | | monthly payment is not received by the close |
| should also be weighed, you will agree that | | | | of the first billing cycle following the |
| if this condition is not true, there is no | | | | payment due date, your promotional APR |
| way you will save money on the new card. | | | | balances will be 24.9%." That's a jump to the |
| | | | stratosphere from a very low rate credit card |
| Action date. This may not be as obvious, as | | | | offer, and that is for being late once! This |
| it is buried in smaller print. The offer from | | | | is where you realize that it is costly to be |
| the credit card company may specify the | | | | late on any of your credit cards. The bottom |
| latest day for you to take advantage of the | | | | line is that when you opt to take the low |
| offer. Sometimes, the offer will specify | | | | rate offer, make your payments on time. |
| different rates for different action dates. | | | | |
| | | | Interest rate after intro period. You must |
| Effective period. You need to know how long | | | | know what the rate will be when the |
| the low rate will be applied to your credit | | | | introductory period is over. Hopefully, the |
| cards. The introductory periods on credit | | | | bank will raise the rate to a fair level, but |
| cards, vary anywhere from three months to | | | | if you comparison shop, you will find that |
| fifteen months, and this obviously will | | | | some rates can reach close to 20%. That can |
| impact how much you can expect to save. The | | | | be painfully high. You need to know this rate |
| longer the time you're in the low rate, the | | | | after the promotion period phases out, to be |
| more money you will save. However, if there | | | | more realistic in your estimate of savings. |
| are credit card processing fees included as a | | | | This assumes that you will not switch to new |
| condition on the transfers, you need to | | | | low-rate credit cards. If the bank tries to |
| calculate a break-even time, that is, you | | | | gouge you, you probably will. There are so |
| must be in the lower rate for a certain | | | | many other offers on credit cards to choose |
| length of time before you start seeing any | | | | from out there. |
| savings. | | | | |
| | | | There are benefits to be gained from these |
| Application of payments. You have to make | | | | low-rate credit card offers. To ensure that |
| certain how payments will be applied to your | | | | you will enjoy these benefits to the maximum, |
| credit card account. Sometimes, the credit | | | | you must do your homework and become credit |
| card issuer will apply your payments to the | | | | card smart. |