0% APR Credit Cards - Tips & Tricks
Credit cards can be considered to be one of the many basic necessities of the modern world. Credit cards are available nowadays in abundance. One type of credit card specifically is the so-called 0% APR credit card. 0% APR credit cards were introduced in the late 1980’s and to this day has still proven to be one of the most sought-after credit card types available anywhere. As with all credit card types, there are a certain tips and tricks surrounding 0% APR credit cards that all potential card applicants should be made aware of.
With the help of a 0% APR credit card, it means that you need not only pay the outstanding balance; and what more you could even charge up to the limits without having to sustain any monthly interest charges. However, sometimes, one tends to think just how these credit card companies can afford to provide 0% APR credit cards, and make a profit out of it?
Although 0% APR credit cards may not comprise any monthly charges, it is sure to come with annual fees which you are obliged to pay for the privileges of a 0% APR credit card. These annual fees usually run from $15 to $20 or sometimes, even higher. Having a 0% APR credit card doesn’t mean that you can pay your dues whenever and whichever way you intend to. It IS necessary to make your payments on time, or else, you will have to pay for high overdue fees. For each late payment, the 0% APR credit card holder has to pay fees that may range from $20 to $40. With habitual late payments, these meager amounts may accumulate to a hefty total!
It should be remembered that 0% APR credit cards are usually offered for only a stipulated period of time. This credit card interest may hold good for only a fixed period of time, usually ranging from 3 up to 15 months. On the completion of this period, a higher rate of interest may come in vogue, usually 12% or higher. You could easily transfer any existing credit card balances to a new 0% APR credit card to get 0% interest on the transferred balance. In this way, the credit card holder has to pay less interest for a stipulated period of time, and thus get a chance to clear outstanding balances as quickly as possible.
When applying for a 0% APR credit card, it is always better to read the terms and agreements of the credit card. Not to overstate an obvious question, but why should one do so? Simply because many credit cards may come with a default rate wherein late payments not only incur a late payment fee, but it would also include a default rate that will be added to the annual percentage rate. This in turn doubles the figures on the existing balances and on the new purchases made on the card moving forward. Ouch!
One very important point to take into account when applying for a 0% APR credit card is to read all paragraphs of the agreement, otherwise known as the fine print. This is because though it is illegal for a credit card company to hide their fees and charges, it is nonetheless legal for them to mention these points in small print! The 0% APR credit card companies thus usually announce in large and bold print about their 0% APR but hide the facts that this is only for a limited period of time and any extra fees which might be included are done so in very fine print.
Another trick that is up the sleeve of 0% APR credit card companies is to install sky-high APR’s right after the amount of 0% APR balance transfers are paid down. In other words, the money you first pay to the credit card company is applied to the transfer, and any other purchases you make will be charged a high APR. Sometimes, credit card companies may also go to the extent of sending you a different card than the 0% APR credit card you had initially applied for. In this way, you are not allowed the 0% APR but a different card offer with different terms and conditions. The card issuers typically rationalize this behavior based on the card issuer determining that you do not meet the qualifications for a 0% APR credit card. Qualifications for a 0% APR credit card is usually found in the small print of the agreement, and is usually overseen by applicants!
It can thus be seen that though 0% APR credit cards do seem to be rather inviting, there are some loopholes and tricks to their use. As always, it is highly recommended to read the terms and conditions on the card application agreement for the 0% APR credit card, or any type of credit card application, thoroughly in order to avoid any future problems, headaches or financial surprises.
Bad Credit Credit Cards - Choosing The Right Credit Card
If you have bad credit, your credit card options are limited. Aside from many credit card companies denying your application, individuals with bad credit usually receive very low credit limits and additional fees.
When applying for a credit card, choosing the right card is essential. Here are a few tips to consider when selecting a credit card.
Take Advantage of Bad Credit Credit Cards
Before applying for a major credit card with a bank, carefully consider your credit rating. Credit card inquiries will decrease your credit score. Thus, avoiding too many inquiries is important. To do so, limit the number of times you apply for credit. Rather, choose one or two companies that are likely to approve your application.
For example, if your credit rating is bad, it's realistic to assume that the odds of getting approved are slim. With this said, it helps to research bad credit credit cards. Several companies issue unsecured and secured credit cards to people with bad credit. This is a great way to improve credit rating and re-establish a good credit history.
Criteria for Choosing a Bad Credit Credit Card
Although bad credit will stand in the way of obtaining low rates on a credit card, researching various companies and comparing offers is smart. Many credit card companies make claims of offering bad credit credit cards to help individuals improve their credit. However, some companies use this as the perfect opportunity to take advantage of people like you.
Before applying for a bad credit credit card, read the fine print for information pertaining to user fees. If choosing a secured card, you likely need to open a savings account and deposit at least $200. This deposit serves as collateral. Because your credit limit is the same as the deposit, if you refuse to pay the credit card, the lender simply claims your money.
In addition to opening a savings account, most secured bad credit credit cards have several upfront or startup fees. This might include a $50 annual fee, $10 monthly service fee, and $20 startup fee. Thus, there is a balance on the credit card before you even receive it.
Unfortunately, extra fees on a bad credit credit card are unavoidable. However, by carefully researching different online credit card companies, it is possible to find a company with lower fees, and one that offers a lower interest rate.