How to Find the Best 0 Percent Balance Transfer Credit Cards

The concept of a 0 percent balance transfer is quite tempting for credit card holders because you are able to shift your outstanding balances on your credit cards to a new one with a zero percent interest rate. Suppose you have five credit cards with different interest rates and different outstanding balances. You can consolidate all of your debts into one single credit card with a 0 percent balance transfer offer, which then means you will be able to pay off the single new balance without any interest.

On this hub, I will discuss what you need to know while seeking 0 percent balance transfer cards. I will also shed light on how you, as a cardholder, can benefit from these zero percent balance transfer offers.

With a 0% balance transfer, the credit card company benefits because it gets more business and the customer feels relieved that his debts on many credit cards are consolidated into one for which he does not have to pay any interest.

Credit card companies are doing their best to attract and keep customers. Since cardholders are shying away from taking any more cards because they are already in debt, credit card companies are using many promotional strategies to retain the old customers and attract new ones; one of the ways to do this is to offer the 0 percent balance transfer credit card.

Credit card holders have to be aware of the many ‘catches’ possible with 0 percent balance transfers. The 0 percent balance transfer offer is always only valid for an introductory period. For example, it might be valid for six months or for a year. So the interest-free period can last only for this amount of time, after which the interest rate on these credit cards can become relatively high.

Also the late fees, over-the-limit fees and penalties for late fees can be higher for these cards than for regular credit cards. Credit card companies often charge high annual fees for 0 percent balance transfer credit cards and there is often a transaction fee involved in the balance transfer, the balance transfer fee.

Additionally, the credit card holder should know that although the interest may be 0 percent for the balance transfer, the interest rate could be high for any additional credit purchases on that same card, which is actually the main function of a credit card. So remember that for a 0 percent balance transfer card the zero percent only applies to the transferred balance not to additional purchases.

As a customer, you can use the 0 percent balance transfer to your benefit to not only take care of your outstanding debts but to also improve your credit rating. Here are tips to get the best out of 0 percent balance transfer credit cards:

1. Find out if there is a transfer fee applicable on the balance transfer. If there is, find out if it is a percentage of the balance transferred or a set fee. Ideally, it is better to go for the one with a set fee or obviously, the one that has no transfer fee at all. If there is no cap on the transfer fee charged as a percentage on your outstanding balance, you may actually end up paying more than what you could have saved.
2. Ask the credit card company how long the 0 percent interest rate is valid. Check with them to find the interest rate after the interest-free period expires. Find out what late fees exist and what annual charges are attached to the credit card.
3. Find out if you can get a 0 percent credit card with the introductory rate applicable to purchases as well as balance transfers. Some credit card companies have different introductory periods and interest rates for balance transfers and purchases; so get clarity on that as well.
4. Do not give your consent for a 0 percent balance transfer on the phone if you feel you want to know more. Find out if there is information on the website and read the fine print before signing on the dotted line. There are quite a few credit cards with 0 percent balance transfer offers on the market right now, so be selective.
5. Go through different zero percent balance transfer credit card offers and choose the one that has the better interest rate, even after the introductory period.
6. Find out if you have to make a certain minimum amount of purchases to activate the 0 percent interest benefit. If there is such a minimum purchase restriction, do not entertain the offer. You can do better.
   

Keep in  mind that this is a little bit like when people on my P90X hub ask me, "Does P90X Work?"  The answer is as much about you and your responsible actions as it is about the value and capability of the product at hand.

Though a credit card 0 percent balance transfer is an attractive proposition, you should only consider such an offer only if you are committed to using it responsibly. Pay off the debt on the new credit card before the promotional period ends. Since you are getting a zero percent interest free period, you are provided with an opportunity to eliminate your debt.  Be responsible and make the most of it.