0% balance transfer offers provide credit card users the opportunity to shift debt from high interest credit cards to ones with low introductory rates for up to 12 months. Unfortunately, credit card companies are increasingly placing a very important, yet easy to overlook asterisks next to 12 months. Because of this fine print trickery, a 0% for 12 months* may actually be a 0% for 6 months.
When applying for any credit card, it is extremely important to examine the fine print. The new credit card laws slated to take effect later this month may have given some the sense that fine print trickery was going to end. It is not; in some ways, it is likely to get worse. Such is the case with 0% balance transfer offers.
Three of the six largest credit card companies currently advertise 0% rates on balance transfer for either up to 10 months* or up to 12 months*. However, each of these three companies places an asterisk next to the deal. Why? In the fine print, these offers state that applicants who meet their highest standards will get a 0% APR for the longest advertised rate. Everyone else who gets approved will get a shorter 0% rate of 6 or 7 months.
The difference between getting a 0% APR for 6 months as opposed to 12 months is substantial, especially with balance transfer fees running between 3-5%. With a 0% for 12 months, a person who transfers a $5000 balance from a credit card with a 15% interest rate will save close to $500 in interest. And this includes a 5% balance transfer fee. If the length of the 0% period is reduced to 6 months, the savings are minimal unless the balance is paid off before the 0% rate expires.
Because so many credit card companies offer 0% rates for up to 12 months and reserve the right to only grant approved applicants a 0% rate for 6 months, some consumers may have little choice but to apply for one of these offers if they seek a 0% APR. If you fall into this category, wait until your card arrives in the mail before initiating a balance transfer. This way, you can see how long your 0% for 12 months really lasts.
-Jeffrey Weber
Related Posts
- 0% APR Balance Transfer Offers in August
A year ago, many major credit card companies were only offering 0% rates on balance transfers for 6 to 9 months. As August begins, 0% APR balance transfer offers remain as strong as they have been in years. The longest 0% balance transfer currently lasts 18 months, while a number of other balance transfer offers [...]...
- 0% Balance Transfer Credit Card Offers in July
Credit card companies are not only continuing to offer 0% APR balance transfer credit card deals lasting as long as 18 months, but many companies actually improved balance transfer offers at the start of the month. Compared to the same period last year, the length of 0% deals is nearly 3 times longer. Citibank continues [...]...
- Balance Transfer Fee Credit Card Report for June 2010
During June, all the major credit card companies continued to charge three to five percent balance transfer fees on 0% APR balance transfers with no maximum fee cap. While some companies are offering low balance transfer fees of 3%, many are charging 4 and even 5%. Citibank and Capital One credit cards offer 0% balance transfers with [...]...
- 0% APR Balance Transfer Offers for September
The quality of 0% APR balance transfer offers in September remains strong. Most major credit card companies have help 0% interest rate periods at exceptionally long lengths and getting a 0% balance transfer for 15 or 18 months is still within reach for most consumers with good credit. Citibank continues to offer the longest balance [...]...
February 8th, 2010 at 10:20 am
For more information on balance transfer offers, please see the 0% balance transfer section of this website, where you can compare current credit card offers and apply online.