When transferring your balance from one card to another, there are certain pitfalls to avoid and benefits to take advantage of. Manoeuvre around the dangers and through the gains to make the most of your balance transfer card. Here are ten pointers to a successful balance transfer.

1. Find a card that offers a 0% balance transfer for the longest possible period, thus prolonging the period that you can enjoy interest free repayments.
2. Transfer your balance to a card with a low balance transfer fee. Some cards charge you up to 3% of your existing balance to transfer, which represents a large amount if you’re transferring a big balance. You can transfer your balance for a fee of around 1.7% if you shop around.
3. Your repayments are tiered so that the cheapest part of your debt is paid off first, and those purchases carrying the highest rates of interest will be paid off last. Bare this in mind before you apply for a card, and know how your repayments will be structured before embarking on this journey.
4. Be real. If you won’t be able to pay off your balance during the interest free period then perhaps a lifetime balance card would be more appropriate.
5. Consider combining the credit card balance transfer with a 0% on purchases offer. If you’re disciplined and sensible with your money, you can use a 0% on purchases card to get discounts on the things you routinely buy. However, reckless spending on these cards can lead to you inadvertently tying yourself to higher interest rates on some purchases and instant cash transactions.
6. Many 0% balance transfer credit cards carry a minimum monthly spending limit. Try to restrict yourself to a card with the lowest minimum monthly spend.
7. Instant cash transactions carry a higher rate of interest than purchases and will be the last thing to be paid off. Making a withdrawal is regarded as an instant cash transaction, but some banks also consider online gambling and even buying gift vouchers to come under this category. Check out their stance before applying.
8. Check also the APR rate after your initial 0% interest phase has concluded. Some cards offer a high APR rate after the initial promotional period to counterbalance their losses.
9. Make yourself some money by paying the repayments that you’re avoiding with a 0% balance transfer credit card into a savings account.
10. 0% balance transfer cards only work if you clear the balance during the initial promotional period. The more you spend on these cards, the greater the risk that you will be subjected to high rates of interest in the future.

Tags: 0% balance transfer credit cards, balance, card, credit, credit card balance transfer, transfer

This entry was posted on Wednesday, March 5th, 2008 at 3:07 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.