Benefits of a 0% Balance Transfer Credit Card

Transfer a Balance to Pay Off Credit Card Debt

Nov 9, 2009 Asa Ghaffar

Has paying off credit card debt and reducing debt interest payments become a priority?Find out how a 0% balance transfer credit card can benefit you.

A 0% balance transfer credit card is a method of reducing debt repayments. It is possible to transfer a balance by completing the new (not existing) card providers forms. The transfer to an interest-free credit card will normally take place over the next calendar month. The lender will then write to the customer to advise them that the transfer has been completed. The amount of time where interest isn't payable will vary considerably between providers, but can be as long as 18 months. It is possible to perform a future transfer when an introductory offer ends to fully clear the amount owed.

0% Balance Transfer Credit Card - Getting Out of Debt More Quickly

According to AOL Money, 15% of take-home pay goes towards clearing the interest on personal debt. Interest avoidance means that a higher percentage of each payment will help to pay off credit card debt. It is important to remember that most providers will charge a 3% to 5% fee to transfer a balance. However, after a few months, the benefits of interest-free credit cards will be enjoyed. Provided that the borrower reduces their credit limit each month, it is possible to become debt-free in a shorter space of time.

Interest Free Credit Cards - Simplify Personal Finances by Consolidating Debt

A 0% balance transfer credit card means that the balance from several cards can be combined together. This not only simplifies family finances, it can also help an individual who regularly forgets to pay and accrues costly charges. It is important to realise that maxing out a card is not recommended as it has a negative implication for a FICO credit score. However, it can help someone who has several cards and a high credit limit. Remember to shut down or reduce the limits on the other cards.

0% Balance Transfer Credit Card - Interest-Free New Purchases

Whilst impulse buying is not recommended, an interest-free credit card could provide a more cost-effective means of borrowing than compared to a debt consolidation loan. It provides a viable alternative to getting a loan for those who need to pay for a car or a family vacation. With the exception of fees, a series of transfers can mean that borrowing money is almost completely interest free.

Transfer a Balance - Avoid Secured Debt

The new credit agreement will not be secured on property so there isn't any risk of losing the family home in the event of default. The unsecured nature of a charge card means that a Debt Management Plan or debt settlement program remain an option in the event of financial difficulties. A 0% balance transfer credit card should be seriously considered by anyone who has a good credit history.

Sources

(9 November, 2009). "Credit card rates set to increase." AOL Money.

The copyright of the article Benefits of a 0% Balance Transfer Credit Card in Personal Budgeting/Finance is owned by Asa Ghaffar. Permission to republish Benefits of a 0% Balance Transfer Credit Card in print or online must be granted by the author in writing.

Advantages of a 0 Balance Transfer Credit Card	Pay Off Credit Card Debt - Avoid Interest Payments	Transfer a Balance to Reduce Credit Card Debt
Getting Out of Debt	Interest Free Credit Cards