Learning About Balance Transfer Credit Cards

Perhaps you have heard of balance transfer credit cards-if you have, be careful not to jump into one too quickly. It is important to learn exactly how they work before you sign up for one. While many of these offers are truly great deals, balance transfers and switching is not something to jump into, eager as you may be.

You need to do your homework first: do enough research and investigating in order to determine whether it in fact is worth it or a good idea to make the transfer. First, find out if it is in fact worth it. Generally speaking, these attractive advertisements and super credit deals advertise very low introductory rates if you transfer your current balance from an existing one onto this new one.

Read everything. Read it through several times so that you make sure you understand what it is saying. It may appear to be a bunch of financial jargon that you might not think is very important, but the truth is, this information is valuable and critical to your decision in whether or not you make the big switch.

Call the company and ask any questions you might have. If the deal is solid and they want to make a sale, generally they should be able to help you out in any way. What do you need to find out about the deal, Here is an example. Let’s say that the advertised introductory rate is 6% (a low rate) on credit card B if you transfer your balance from credit card A, where you currently rack up an APR of 18% (a standard rate).

Before you make the big plunge, make sure you know exactly what you, yourself, will be getting. There may also be other conditions. For example, some companies may penalize you for one late payment and take you off the introductory rate onto their regular rate, which may be higher than your current card’s rate.

However, many credit cards with these introductory rates offer great deals for people interested in switching ones and transferring their balance over and can be more than worth it. The important thing is to do your research, read the fine print, and ask questions to determine which credit card and deal is the right one for you.

Once you’ve selected the right credit card offer, the next step is to fill out the balance transfer application form completely and accurately. Next, make the minimum payment on your original one while you wait for the balance transfer to go through. When it has gone through, the new company should send you a notice, after which you will need to verify the transfer with your old company so they can send you a zero-balanced billing statement. Finally, cancel your old one since you don’t need it anymore-it will also save you some temptation. With this information, you are set to go! Terry Daniels is an accomplished expert in personal finance. With 12 years of experience, he offers great advice for any small business merchant account.

For years, credit card companies were able to build their business by enticing new customers from the ranks of those who'd never held plastic before. But with the numbers of credit cards in circulation rising and the average Brit carrying four different cards in his or her wallet, they've had to get competitive with each other.

Thus was born the marketing tactic of offering 0% interest for any balance transferred from a competitor's credit card to a new card. Those 0% balance transfer deals were greeted enthusiastically by the public - a bit more enthusiastically than the issuers of those cards expected. They missed a vital point in their calculations - customers who switch cards for a better rate of interest have already given up brand loyalty in the interest of getting the best deal. When the 0% interest ran out, they simply moved their remaining balances to another card.

To counter that, the big credit card companies started modifying their offers with restrictions designed to keep people from jumping from card to card following the best rate. Some of those restrictions are openly stated and easy to see - reductions in time on the introductory rate, for example. Others are hidden in the conditions and terms of your credit card agreement.

Those 'traps' make it all the more important to carefully compare balance transfer credit cards before you move your carried balance from one card to another. It's still worth your while to check on the newest balance transfer offers a couple of times a year, say the money experts, but be sure to compare the offers before you jump from one card to the next.

What is The APR on Your Transferred Balance and How Long Does It Last, There are very few 0% balance transfer card deals left, but there are a few. The 0% APR on transferred balances may last for three months, six months, nine months, or in some cases for the life of the balance transfer amount.

More often, the APR on your transferred balance will be a low 1-2% for the life of the balance, as long as you conform to certain restrictions. What is The APR on New Purchases, Many of the new balance transfer offers require that you use your credit card to make a certain number of purchases per month.