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[02:20:16 AM Tuesday, April 24, 2007]
Zero percent interest credit card offers? You can capitalize with these cards!
Credit card companies really will do anything they can in order to get as many customers as possible. All of the top credit card company carriers such as VISA, MasterCard, Discover and American Express offer cards which zero percent features.
Zero percent credit cards offer card holders the opportunity to avoid high interest payments (at least for a little while!) and purchase what they really want. The best thing about these credit card offers is that you can use them to transfer other card balances to your new zero percent credit card in order to save money.
Of course there are a few limitations that come along with the zero percent programs but if you use them right you have the potential to save hundreds of dollars on interest alone. Zero percent cards are in the market today because all of the main banks are fighting over one another in order to gain the most clients. They are still banking off of making money off of you eventually but by allowing you to have introductory zero percent interest rates they are hoping to keep you as a customer for life.
Here's how it works: A credit card company usually offers a card that will let you transfer cash onto it so you can pay zero percent interest on the balance that you were previously paying high interest on. These low rate cards are not available to everyone though- they can only be given to those with good and even excellent credit. If you are an individual with bad credit the chances are you will never get a zero percent card. The credit card companies do not want to get taken advantage of too badly!
As long as you stay out of the penalty zone that a lot of these credit cards have you can make the best of low rates. Here are some things you should be aware of:
Fees associated with balance transfers: Be aware of the fees that some credit card companies will try to charge you on transferred balances. Usually a card holder will have to pay a percentage of the balance. Try to avoid these cards because you won't be saving that much money on interest after paying these fees.
Late fees: Late fees can be pretty harsh on zero percent transfers. Try to avoid at all costs paying late on your credit card because the late fees can be pretty hefty.
Length of Intro Rate: Every zero percent credit card comes with the zero percent at an introductory rate. It will last anywhere from 6 months to 15 months. After this time period the low rate can often be skyrocketed up to over 20%! Just be aware of this time period when you are searching for a card. Don't be gullible in believing that you're zero percent periods will last forever because it won't.
New purchases: A lot of times the zero percent interest rate will only apply to your transferred balances. This means you won't be charged zero percent on new purchases, you'll have to pay whatever their real interest rate is. So before you go out and charge a new car to your credit card thinking you'll have zero percent interest for 15 months to pay it off- think about this! The fine print on your credit card application will tell you about these finer details.
Zero percent interest on credit cards can be a great way to save a lot of money but can also be a way to get in extra trouble. If you are thinking about taking this option make sure you read into it 100% before making a rash decision.
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