Zero Percent Credit Card Offers
Consumers Can Use the No Interest Charge Cards to Their Advantage
Oct 4, 2008
If a credit card issuer is willing to offer someone a zero percent interest rate, credit cardholders, if they are wise, can take advantage of this lucrative offer and make it work to their benefit. There are, however, a couple of things that potential card holders should be aware of prior accepting one of these attractive credit card offers.
Credit Card Introductory Rate
The zero percent interest rate is usually for a limited period of time. It is important to know how long the introductory period lasts. Cardholders should contact the credit card issuer or read through of the terms and conditions of the credit card to understand how long the attractive interest rate will last.
Credit Card Balance Transfers
Before using the credit card, find out whether or not the zero percent interest rate applies to new purchases and/or transferred balances. Some credit card companies apply the zero percent rate to transferred balances only, others for purchases only and still others apply the attractive rate to both. Knowing how the interest rate is applied will help to determine how to use the credit card.
If the zero percent applies to new purchases only, then it's wise to use the lower rate credit card for daily purchases. If the zero percent applies to the transferred balances only, then it makes sense to transfer balances from higher interest rate cards to the zero percent credit card. After transferring the balance, put the credit card away. It’s best not to use it for spur of the moment purchases unless the rate applicable to new purchases is lower than the cardholders existing credit cards.
The most attractive of the options is to have a zero percent credit card whose rate applies to both balance and new purchases. Be aware, however, that some cards charge for transferring the balances. Make sure to look at the fine print and find out how much of a fee applies for transferred balances and whether or not its based on a per balance transfer basis.
Built-in Credit Card Fees
While the introductory rate is more than attractive, expect the other shoe to drop. Once the introductory rate is over, credit card companies apply a much different interest rate. Find out what that interest rate is prior to accepting the card. In addition to finding out the rate, be familiar with other fess such as late fees and over limit fees.
Can the Zero Percent be Revoked?
Some credit card companies will revoke the zero percent interest rate if the cardholder is late one time with a payment. Therefore, it's important not only to find out what the late payment fee is but also to find out if there is if there's a possibility of losing the attractive rate prematurely.
Consumers should be wary of deals that sound too good to be true. The last thing a credit card holder wants to find out after purchasing a substantial amount of items using the zero percent credit card is that there was an unexpected clause in the fine print which voiced the low interest rate.
It's important to read the fine print.
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