Points To Think About When Getting A 0% Interest Credit Card

In the past years, a 0% interest credit card may seem like an impossible deal

. But as the popularity of credit cards increase and the competition among card issuers grow stronger, different types of credit cards with attractive offers have been introduced in the market.

Why Zero Cards Are Popular in The Market

Today, zero percent interest credit cards are getting the attention they deserve. Besides, who can resist a card that gives you the chance to charge balances to your card without interest? If you have to make a choice between a high rate and one with a zero interest offer, without a doubt, you'll go with the zero interest card.

Clearly, card companies use the zero interest rate offer to convince a prospective card holder to sign up with them. Usually, those who have outstanding balances in their old credit cards with high rates are convinced that they should transfer their balances over to a zero interest card. This way, they can focus on paying off their debts minus the interest rate. But the zero interest doesn't last forever. In fact, the zero interest may not even last long.

Sometimes, the card holder is given 6 months to 12 months to finish paying off his balances without interest and companies know that most often than not, the card holder will not be able to complete payments on time. After the 6-month or the 12-month period is over, the card holder will still have unpaid balances on his account. Consequently, you will have to continue paying for them and the regular interest rates will be applied.

Zero Interest Rate on What?

What about the interest rate applied on your purchases? If the 0% interest applies only to balance transfers, you will still be charged with interest when you incur new balances in your card. Therefore, before you use that zero interest card for shopping, check on how much interest rate you could be facing if you fail to pay for those purchases in full by the end of the month.

Aside from the rate of interest, you should also pay attention to the other fees that you can be confronted with. These additional credit fees include the annual fee, balance transfer fee, late penalty fees, etc. All these costs are disclosed in your credit agreement so you should really take the time and effort to read and understand it before applying for the card.

In conclusion, credit cards with zero interest rates are indeed an enticing offer. However, it will only work for you if you make the right credit card choice. Also, a zero interest card can only help you if you are determined to make your payments accordingly. Otherwise, the zero interest rate deal will not do much for you at all. Just like with any credit card, the key is to take your payment obligations seriously and be a responsible holder.

by: Shelly Evans

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