0% APR Credit Card Tips
Avoid 0% APR Offers With Multiple Introductory Periods: Most 0% APR credit cards are straightforward and offer the same 0% introductory period to all approved applicants. However, some 0% credit card offers are a bit tricky. These cards will advertise 0% interest rates in two ways. The first is a range. For example, a 0% APR for 6 or 12 months. If you see this type of offer, your 0% rate could last either 9 or 12 months based on a review of your application.
A more insidious way 0% rates are advertised involves the wording "up to," for example, a 0% APR for up to 15 months. With one of these offers, you need to dig deep into the fine print. There you will find that some applicants will get a 0% APR for 15 months, while others may be approved, but only granted a 0% APR for as little as 6 months, the legal minimum. Unless you have pristine credit, avoid offers that use this type of pricing to insure you get the terms you desire.
Don't Take on Extra Debt Simply Because You're Paying 0% Interest: Credit card companies offer 0% APR credit cards for one reason: to make money. While they do profit every time you swipe your card, the big money is made when 0% rates expire and regular interest rates kick in. When you use a 0% credit card, try to keep your spending in check so you aren't faced with high interest expenses when the 0% honeymoon ends.
Take Advantage of Extremely Long 0% APR Offers: Since early 2011 and thus far in 2012, credit card companies have been offering the longest 0% introductory periods in at least five years, if not in history. Two years ago it was difficult to get a 0% APR for 12 months; today, a handful of credit cards offer 0% rates that last 15 months or longer. Unfortunately, the explosion in long duration 0% deals won't last forever. When the economy recovers, the Federal Reserve will increase the Federal Funds rate. This, in turn, will make it more expensive for banks to borrow money, and this cost will passed on to borrowers in the form of higher interest rates and shorter 0% credit card deals.
Be Careful with 0% APR Offers with Different Terms for Purchases and Balance Transfers: If you intend to use a 0% APR card for both purchases and balance transfers, select a card that offers the same introductory period for both. This is especially important if you pay close to the monthly minimum. The reason caution is necessary stems from the way credit card companies are allowed to allocate your payments. Every penny of your minimum payment can be used to reduce the balance with the lowest rate. Thus, if you use a card with a 0% APR for 12 months on balance transfers and a 0% APR for 6 months on purchases, when the 0% rate on purchases ends, your minimum payment will be used to reduce the balance with the 0% rate, while your high interest purchase balance continues to rack up interest.
Ideas to Help You Find the Right 0% APR Credit Card
The Current State of 0% APR Credit Cards: Although average 0% credit card offers currently last about 1 year, many credit card companies are offering 0% deals with significantly longer introductory rates. Presently, the longest intro periods for balance transfers and purchases last 21 months. In this article, you can learn what banks have the best deals. Full Article.
Timing is Crucial to Maximize 0% APR Benefits: When you open a new credit card account with a 0% rate, the clock starts ticking. If you use your card for balance transfers, you'll want to initiate the transfers as soon as possible to get the most value out of your 0% period. Full Article.
0% APR Balance Transfer Market Overview: Credit cards that offer a 0% APR on balance transfer offer consumers a unique opportunity to pay down credit card debt without the burden of daily compounding interest. In this article, you can learn about what types of 0% deals major credit card companies are offering on balance transfers. Full Article.