Monday, 18 June 2012

Balance Transfer Credit Cards With No Transfer Fee

How to Compare Balance Transfer Credit Cards With No Transfer Fee

A No Fee Balance Transfer credit card is a type of card that exists primarily to allow a user to transfer an existing balance from a different card. No fee balance transfer cards typically have lower interest rates than your regular credit card, which allows you to catch up on paying some debt without having to worry about also managing your colossal interest rate. As with any type of credit card, however, there are some things that you have to consider before picking a card to use for a balance transfer.

1. Look at the introductory interest rate on your no fee balance transfer credit card. At the least, you want to make sure the card that you're transferring a balance to has a significantly lower interest rate than the one that you're transferring the balance from. If the interest rates are the same or close to each other, the money you'll save from this process will be minimal.

2. Note how long the introductory interest rate on your no fee balance transfer card will last. Typically these low interest rates last only six months to one year. Look at how long the promotional period is on any card you're thinking of using and mark that date on your calendar or in your cell phone or PDA so that you don't forget it.

3. Do the math and understand what the interest rate will jump to after the introductory period is over. Make sure you'll still be able to manage card payments even if the interest rate jumps significantly. You don't want to find yourself in the same situation you were in when you needed the balance transfer in the first place.

4. Research what the penalties are if you miss a payment. Typically the penalties are steep on no fee balance transfer cards. One missed payment could result in a bevy of late charges and finance charges, as well as a dramatically increased interest rate happening much sooner than you anticipated. Make sure you'll be able to make all your payments on time before picking a no fee balance transfer card.

5. Choose the card with the features that suit you best. A no fee balance transfer card may not work for you if it has a high annual fee. And if you intend for the no fee balance transfer card to serve as your primary credit card for purchases, then the introductory interest rate may be far less important than the normal interest rate after the introductory period is over.

Additionally, some no fee balance transfer cards offer cash back, rebates, reward points, and high credit limits for qualified applicants, amenities that can be beneficial if the card's normal interest rate isn't too high.

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