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A few years back, ’0 APR on balance transfers charge card accounts’ was a common noun in the financing industry. While getting a 0 APR on balance transfers for life was a rare deal even then, today, due to the credit crisis, even the number of institutions offering 0 APR on balance transfers for 12 months has come down drastically. This article delves deeper into what ’0 APR on balance transfers’ means, the uses of 0 APR on balance transfers and the ‘do and don’t’ information on 0 APR balance transfers. Before we move further though, you can brush up on your financial concepts first, by reading the article APR vs APR.

The 0 APR on Balance Transfers Concept

Essentially, 0 APR on balance transfers means an offer that claims to charge no additional interest on the transfer of balances from one financial instrument to another. For a normal borrower, these are ‘charges free’ offers to transfer balances from interest bearing financial instruments to 0% interest bearing financial instruments. In layman’s terms, if you have a debt that requires you to pay, say about a 7% interest in it, you can get it transferred to a 0 APR balance transfer charge card account and save on your future interest payments, that you would have otherwise made on your initial debt. To make this even more attractive, some charge card account companies even advertise a ’0 APR on balance transfers, no transfer fee’ offer. In fact, some 0 APR on balance transfers charge card accounts also come with other attractive schemes like cash back offers, rebates, reward points, higher credit limits, etc. Sounds too good to be true, right? Know more on credit card debt.

Uses of 0 APR on Balance Transfers Credit Cards

If you are someone who is overburdened with high annual percentage rate debts, 0 APR on balance transfers charge card accounts offer you the perfect way to save some cash. Let us have a look at some of the uses of this debt reduction facilitating instrument. Know more on credit card debt consolidation.

Many high interest bearing credit cards disallow debt consolidation in their terms and conditions. In such a case, you can use 0 APR balance transfer charge cards to pay off these higher interest debts and substitute your high interest payments with really low ones.

For unexpected extra cash needs or to support high expenses, one can use 0 APR on balance transfers credit cards to get that additional cash infusion. Most of these 0 APR balance transfer credit cards make direct cash transfers into your bank accounts and hence, are mostly hassle free.

You can use 0 APR on balance transfer charge card accounts to make high yield savings. You can borrow cash at interest rates as low as 0 % APR and invest them in banks that offer higher interest rates, say about 5%. This way, by taking no high risk positions and just through the transfer of cash from one account or instrument to another, you can earn hundreds of dollars.

Dos and Don’ts of 0 APR on Balance Transfers Credit Cards

Contrary to the impression one gets from the 0 APR on balance transfers scheme of credit card companies, they are not stupid and this is not a non-profitable offer for them. 0 APR on balance transfers credit cards are just meant to lure borrowers into the debt business. One mistake in payment and they are saddled with enormously high annual percentage rates and worse terms and conditions. So you see, the charge card account companies do stand to gain a lot from these charge cards. Yet, if the borrower takes care of a few ‘do’s and don’ts’, he is effectively borrowing money for free, a boon beyond imagination. Here’s what a borrowers must be careful with, in order to get the better end on the bargain in 0 APR on balance transfers charge cards.

Read all the clauses carefully in the terms and conditions document before signing yourself up under the scheme. In some cases, the 0% APR on balance transfers scheme is only promo and only lasts for a few months after enrollment. On expiry of the designated period, the borrower is actually charged an annual percentage rate. Make sure you know the rate and you know exactly when it will be applicable to you.

All 0 APR on balance transfers charge cards do not come with the ‘no transfer fees’ clause. If your card has transfer fees, find out exactly how much it is and in which cases it would be applicable (some credit card accounts even consider convenience checks to be balance transfers).

Make sure that you always pay your due payments on time. As I mentioned earlier, this scheme is just a lure and the charge card account companies are just waiting for you to delay or default, so that they can charge you inflated interest rates from then on. The best way to ensure that you are not saddled with a shocking 20% APR as penalty, just set up ‘automatic payment’ from your bank account.

Keep an eye out for any changes in the credit card company policies. For example, be prepared for early payments if the company suddenly decides to reduce the payment grace periods.

It is more prudent to not apply for a balance transfer along with the main application. Get approved first and then apply for balance transfers later and know your credit limit before actually you do so.

Look around for all the available options before you choose your 0 APR on balance transfers credit cards. Some good options are the Citi Platinum Select Mastercard, the Discover More Card, the Miles Card by Discover, the Chase Slate Card, etc.

While the pros of 0 APR on balance transfers cards are good many, you might be worse off due to them. If you fall in any of the following categories of borrowers, it is recommended that you do not apply for them, lest you go from crisis to catastrophe overnight.

If you have poor credit scores or have a credit history of carrying frequent balances, 0 APR on balance transfers are not for you. With your immaturity in handling debt, there is a higher probability of you falling into a debt trap and piling on even more debt than before with the use of 0 APR on balance transfers charge cards.

If you require an excellent credit score for something (like a mortgage application or loan) soon, balance transfer credit card accounts may not be suited for you. The idea will serve you best if you pay off all your balances a few months before you apply for your mortgage loan, so as to give your credit scores time to recover and improve.

If you frequently forget to pay your bills, you are exactly the kind of customer that credit card account companies are hoping to lure with 0 APR on balance transfers credit card accounts. One late payment and your will be saddled with an interest rate probably higher than 20 percent. Think about this, weren’t you better off before you took the 0 APR on balance transfers charge cards bait, in this case?

Before I end this article, I have some vital piece of information to give you. Don’t wait for better deals in the field of 0 APR on balance transfers charge cards, for you may be waiting for ever. With the credit scenario changing almost everyday, what you’re getting today may not even be there tomorrow. Make hay while the sun shines.

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Balance transfer credit cards have become a great way to keep banks on their toes when it comes to competing for your business. If you have built and maintained great credit scores, balance transfer credit card account accounts have become your way to keep lower annual percentage rates throughout the life of your debt. I am going to go over the top 4 balance transfer charge card accounts hopefully this list helps you to pick the best credit card for you:

Balance transfer charge card account #1:

The balance transfer charge card that takes the #1 position is issued by Discover cards. The Miles by Discover card is a great choice for a few reasons. First off this card offers a 0% promo interest rate on balance transfers that lasts for 6 billing cycles. After the introductory APR, the standard interest rate on the card will be a low 10.99-16.99%. Aside from the interest rate, the reward system on this credit card account is phenomenal. You can redeem your rewards points in many ways however the most common ways from Miles by Discover users are airfare, gift cards, and cash back.

Balance transfer charge card #2:

The #2 balance transfer charge card is the Slate card from Chase. As with Miles by Discover, the Slate card also offers a 0% introductory interest rate. However, for balance transfers, this 0% offered lasts for a full 12 months. Another thing that is appealing about any Chase cards is the impeccable customer service offered. Chase is known for some of the best customer service ratings in the credit card account industry. Finally, the Slate credit card is said to be the most secure credit card account out there. With patented fraud protection guidelines Chase really did go all out on this credit card.

Balance transfer credit card #3:

The balance transfer credit card account in third place is the Escape by Discover card. Much like the Miles card, Escape also offers a 0% intro APR for 6 months on balance transfers. The long term APR is also the same ranging from 10.99-16.99% depending on your credit. What really sets this credit card apart however is the reward system. Receive double miles on qualifying purchases and 1 mile for every dollar spent on the credit card account. Also, reward redemption offers vary. With so many choices for reward redemption with this charge card, you can’t go wrong.

Balance transfer credit card account #4:

Taking fourth place today is a credit card that is fairly new to the balance transfer industry. The IberiaBank Visa Select charge card account has some very unique features. One of the great things about this credit card is the long term low annual percentage rate of prime (currently 3.25%) plus 4.25% this is one of the lowest long term annual percentage rates in the credit card account industry to date. The only real draw back to this credit card is the application process. To be approved for this credit card account you must not only have excellent credit but, you must also prove your income which in some cases can be a bit annoying to consumers who have paid their bills on time every time.

Ok so you have finally heard about balance transfer charge card accounts! What next? You know you’re paying way too much money in interest on your current credit card, but you don’t know how to find the best balance transfer charge card account. I completely understand, it can be a hard task weighing out the benefits and features verses the negative aspects like fees and annual percentage rates. So here are a few things for you to think about when searching for best charge card for balance transfers:

How The Introductory Period Works:

Most balance transfer credit card accounts will come with an introductory APR that usually ranges from 0% to 5%. These low APRs don’t last forever, DON’T GET SUCKED INTO A BAD SITUATION! 2 years ago, you would see introductory interest rates lasting as long as 18 to 24 months, unfortunately today the economy has pushed lenders to shorten the introductory period on balance transfer credit card accounts. In most cases, these low interest rates will only last anywhere from 6 to 12 months. Although this isn’t a great thing, it still may be worth your while to take advantage of this short term introductory interest rate. There are a few more factors that you will want to think about before applying for a balance transfer charge card however, the introductory period is the first thing you want to look at.

What Is The Standard Interest Rate:

The standard interest rate on a charge card is the interest rate that you will pay after the introductory period for that card expires. It is very important that you know the standard annual percentage rate for any credit card you may apply for. Even if you feel that you can pay the entire balance off in time allotted in the introductory period, it is always best to be safe. Things happen that are beyond human control that may cause you to not be able to pay the balance in full. If you chose a credit card account with a higher standard interest rate than what you are currently paying, you may find yourself in a worse situation than you were in before you started searching for balance transfers.

What Is The Balance Transfer Fee:

Balance transfer fees are fairly new to the charge card industry and many people make transfers online without being fully aware of the consequences of the transfer. A balance transfer fee is the fee that a bank will charge you to transfer your balance from one credit card account to another. These fees usually range between 3% and 5% of the overall transfer. I know it sounds like a lot of money and really it is but when you break it down, this still could work in your benefit. If you have to pay a 5% fee to transfer a balance from a charge card with 18.99% interest to a credit card account with 0% interest for a year and 13.99% thereafter, you are still going to come out ahead given that you are unable to pay your balance in full on a monthly basis.

Final Note:

One last thing I would like to leave you with, please remember there are scams and fraudsters out there. Unfortunately we live in a time where some people are not very honest and morals will sometimes get thrown out the window at the first opportunity to make a buck. Please make sure to use a reputable credit card comparison website like JemCreditCards.com or 1-2-3-CreditCards.com when comparing credit cards online. Also, I would advise starting with Discover credit cards or Chase credit cards whereas they tend to have the best offers!

Many consumers will use balance transfer deals to pay off existing debts on their credit card accounts. The best known solution may be the 0% deal but some also use lifetime balance products as an alternative. What are the differences between these deals and which is the best one to use?

What are the Differences Between a Balance Transfer for Life and a Zero Percent Deal?

Both of these options share some features. In both cases they allow the transfer of a balance/balances from other charge card accounts on to a new product. The aim for most here is to use the new deal to pay off charge card account debts.

The first difference between the two is the length of time that the offer is applied to the balance transfer. So, for example:

A 0% deal will usually only be offered for a set period of time.

A lifetime balance transfer offer will last for as long as it takes to pay off the money that is switched to the new card.

There are also differences between interest rates to consider here. A 0% deal will charge no interest on the balance transfer (and possibly on new spending) until the offer is finished. A life of balance offer will charge interest but this is usually set at a lower rate than would come with a regular credit card account (new spending may be charged at a higher rate).

Zero percent deals also come with a balance transfer fee that is usually charged as a percentage of the money switched over. Although many lifetime balance offers may also charge a fee, it is possible to find some that won’t. A no fee balance transfer, however, may mean higher APRs.

Is it Better to Use a Lifetime Balance Transfer or a 0% Deal?

Choosing the correct option often comes down to the extent of the charge card debt to be transferred. Those that know that they can pay off all their debts in the time given by a 0% deal may, for example, find this the best solution. They’ll have to pay a fee to set up the switch but will then be charged no interest on their transferred sum.

Those with large debts or limited repayment budgets, however, may need more time pay them off than they’ll be given with a time limited 0% deal. For some, a life of balance transfer will work out better as they can take as long as they need. They’ll also most likely get a lower annual percentage rate than with their original card(s) so should save some money.

In some cases, it is possible to move from one 0% balance transfer card to another once the initial offer is done. This can give enough time to pay off all that is owed by using a variety of cards to gain all the time that is needed.

Do bear in mind, however, that each new zero percent card will come with a transfer fee and this may significantly add to the costs of debt repayment. This may be worth estimating as it may be cheaper for some to take a life of balance offer instead even though the lower rate of interest will be payable.

Before making a choice between 0% or life of balance transfer credit cards it may be worth looking more closely at the advantages and disadvantages of each option. Understanding how 0% balance transfers work, for example, may make it easier to compare them with life of balance options. Those interested in clearing credit card debts as soon as possible may also want to investigate ways to speed up the repayment process.

Also, if you are looking for the best charge card for balance transfers, make sure to use a reputable credit card comparison website like www.1-2-3-CreditCards.com. I would advise starting with Discover credit cards or Chase credit cards they tend to have the best offers!

The problem may be that your credit rating is not high enough to get the new lines of credit you need in order to transfer all your balances. Ironically, by cancelling your $29,000 charge card you may have reduced your credit score (FICO).

If you close your accounts, you may be closing your options.

Your credit score is based on many components–most importantly, the timeliness of payment on debt. After that, other components include: type of credit, amount owed, length of credit history, and how much debt you have relative to your available credit.

It’s those last two items that may hurt your score by canceling your credit cards. What I suggest is not closing the account, but simply using it infrequently. I use each credit card account that I have for at least two weeks during the year. This way the bank doesn’t close the account for inactivity, and I benefit from having many cards with long histories.

Additionally, your best low-rate offers will arrive by mail on your existing accounts. Hold on to the card, and don’t use it for a while. Once that bank realizes that they’re not making money from you, they will send an enticing low-rate offer hoping to hook you in until they can raise the rate. Once that happens, and you take advantage of the low-rate, all you need to do is be DebtSmart by watching the calendar, being careful to transfer your balance to another low-rate offer before the first bank has a chance to raise their rate once the promotional deal ends.

The other problem with closing your account is that the debt-to-available-credit ratio will increase. For example, say you have two credit card accounts, each with a $5,000 credit limit and one has a $5,000 balance. As it stands, you have a debt-to-available-credit ratio of 50% because you owe $5,000 on a total of $10,000 in available credit. If you closed the 0-balance card, you would owe $5,000 on a total of $5,000 in available credit, which is a 100% debt-to-available-credit ratio. In other words, you’re totally maxed out. Banks like to see this ratio at about 30 percent, so it’s in your best interest (no pun intended) to keep that number low. Simply getting new lines of credit will bring that down and possibly increase your score. You can find out more about your credit rating, and how to get it, by visiting http://www.1-2-3-CreditCards.com!

Also, when searching for the best credit card for balance transfers, it is important to use a reputable credit card comparison website like www.1-2-3-CreditCards.com. Shop around but start with Discover cards or Chase credit cards whereas they tend to have the best offers. Once you get approved for a balance transfer credit card, please remember to use it correctly. Many people see 0% for 12 months and decide to max out the card with the hopes of being able to pay it off within the 12 months only to find themselves with bills they can’t pay on month 13. Make sure you don’t fall into this statistic!

As the economy gets better, I am beginning to see balance transfer offers in the mail more often. One of the best offers right now is the 0% balance transfer for 15 months from Citi Platinum Select MasterCard. Balance transfer is a tempting option if you’re in debt and want to transfer your balance from higher rate charge card accounts to one with 0% interest for as long as 15 months. Or perhaps, you just want to put off paying for that big purchase for a few months, and be able to do so at your own pace without paying finance charges.

However, you have to be cautious when dealing with balance transfer offers. If used correctly, they are awesome. Sadly, most people just end up paying the balance transfer fee, accumulate more debt, and when the honeymoon is over, they still have the original debt they transferred. So, the first important thing is to make sure you don’t fall into this trap. If you feel unsure, you’re probably better off not doing the transfer even if the math made sense.

Balance Transfer Fee

If you decide to go for it, then makes sure the fee doesn’t end up costing you more than the interest payments. For example, the Citi Platinum card has a balance transfer fee equal to 3% of the amount of each transfer, but not less than $5 and not more than $99. If the finance charges on your current card are going to add up to more than $99, then it probably makes sense to transfer.

Adding New Debt to the Old

If you’re going to do a balance transfer, do yourself a big favor and put all of your charge card accounts away for the duration of the interest free period. The whole idea is to pay down your debt. If you keep making purchases with your charge card account, it’s very likely that you’ll put off paying down the transferred balance. Next thing you know, the interest-free period is over, the rate get jacked up, and you are back in the same shitty spot all over again…or worse.

Shop Around

Not all balance transfer charge card accounts are created equal. The offer I mentioned above is very good, but it’s in your best interest to shop around. Here’s a list of 0% balance transfer credit cards you can start off with, but if you can’t find the right card there then keep looking.

Your Credit Score

Before you get too excited about these offers, make sure you read the fine print. More often than not, the advertised offers are only available if you have a good credit score — don’t be surprise if the interest-free period is not as long as you thought it would be.

Also keep in mind that opening a new credit card account account can temporarily lower your credit score, as will closing your old accounts (it’s usually best to keep them open). This can affect your ability to borrow other money or find affordable insurance premiums. You should thoroughly assess your financial situation before you open a new account.

Pay On Time

Balance transfers often take a few weeks to complete. Remember you will need to pay at least the minimum payments on your current credit cards until the transfers go through. Once you have your new card, you’ll also have to make sure that you also pay on time. If you’re late with your payment even once, you can kiss your interest-free period goodbye and possibly end up in a very tough spot.

Overall, credit card account balance transfers could be beneficial — e.g., reduce your monthly minimum payments, help you pay off you debt faster, save you cash on finance charges, etc. But before you jump in with both feet, make sure you know what you’re doing.

Finally, when searching for the best credit card for balance transfers, make sure to use a reputable credit card comparison website like www.1-2-3-CreditCards.com. For these types of cards I would advise that you start with Discover cards or Chase credit cards