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Thursday, January 28th
For consumers who tend to carry a lot of credit card debt, getting a lower interest rate through a 0 Balance Transfer Fee card can be a smart way to save money. Why pay interest rates over 20% when you can move your balances to a credit card with a much lower introductory rate AND no balance transfer fees?
Is a Zero Balance Transfer Fee Credit Card Right For You?
Do you usually pay off your credit card balance in full every month? If not, you're in good company: up to 85% of all Americans carry a balance on at least one credit card from month to month, according to the Consumer Financial Protection Bureau.
But, the savviest consumers know that they don't have to be stuck with skyrocketing interest rates forever. The trick? Making smart use of 0 Balance Transfer Fee credit cards.
No Balance Transfer Fees? Yes, Really
Credit card companies make money every single time you swipe your plastic. They want your business, to the point of making it worth your while to move your balances over to their cards. There are two main ways they sweeten the pot, so to speak: 0 intro APR and 0 balance transfer fee. Let's take a look at how that works.
0 intro APR is the most common offer. Imagine that you're currently carrying a balance of $3000 on a credit card, and your APR is 25% (ouch!). To try and win your business, a new credit card might give you an interest rate of 0% for a certain period of time, typically from 12-15 months. Pay off that balance within that introductory period, and ta-da: you've now saved up to $600 in interest fees!
Less common but still attractive is the 0 balance transfer fee promotion. In the situation described earlier, the credit card company might charge a transfer fee of 1-5% of the total transferred balance. You'll still save money with that lower interest rate, but your total savings is less - unless the card also offers a "no balance transfer fee" incentive too. Those cards can be harder to find, but they do exist!
0 Balance Transfer Fee Cards: Plan Wisely
If you're going to try and boost your savings with a 0 Balance Transfer Fee card, here are a few things to keep in mind.
TopConsumerReviews.com has partnered with Lending Tree to help you find the best Zero Balance Transfer Fee Credit Cards on the market. We hope this information will get you a great offer on a credit card that will save you money now and in the long run!