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How to take advantage of Low APR and Balance Transfer Cards?

- by editor

Do you have credit debt but unable to pay them off in the near term, are you making minimum payment every month because you canít pay them in full yet? If so, you may need a credit card that offers 0 or low balance rate. These credit cards can save you hundreds or even thousands of dollars that you would have had paid in financial charges.

Simply choosing the credit card with the lowest balance transfer rate is not always the best decision. Many credit cards offer various transfer rate and period. Typically, the lower the balance transfer rate, the shorter the period. However, some credit cards offer you 0 or very low interest rate for up to 15 months. But you have to keep in mind that not everyone is qualified for these offers, you are required to have good or excellent credit. If you do have good credit history, you may be able to ďbargainĒ with the account manager to get an even lower rate when you activate your card over the phone. The larger the balance you want to transfer, the best rate you will get. With every new card activation, the account manager will typically ask if you carry balance on other credit cards and offer you a lower rate you transfer your current balance. If you have seen other cards offering best rate, be sure to mention to he account manager, he or she will most likely to offer you a competitive rate. Another thing you need to keep in mind is that most of the card companies charge a one-time balance transfer fee, it can be as little as 1 percent to 3 percent or a fixed amount. So the more you transfer, more you might have to pay upfront. The fee is insignificant compare to the interest you would have to pay.

Why credit card companies are so generous? Whatís the catch? Credit card companies wouldnít lend you money for free, right? Thatís correct, but there is really no gimmick here. What the credit card company is hoping for is that you forget or unable to pay in full and continue to carry that balance after the introductory period is over so that they can make money out the higher interest you will be paying. During the intro period, you will still need to make the minimum monthly payment. To avoid paying higher interest, be sure to pay off the entire balance before or on the last intro billing cycle. Donít count on the credit card company to remind you of the last intro billing cycle. They will never do that. If you canít really pay it off at once, speak with the account manager to request an extension.

Using balance transfer is a smart way to pay off of credit card debt. Take advantage only if you need it. It should not be viewed as a way to borrow more money. So, use your credit wisely and choose the right credit card.


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