Transfering 0% Interest Credit Card Balances

These are some tips for O% Interest Credit Card Balance Transfers. For the past 4 years, I have been transferring a balance of £3-4000 from one credit card to another. During this time, I have never paid interest on this credit card debt. I have been careful to take advantage of introductory credit card deals which offer rates of 0% for 6 -12 months. This debt has been valuable for improving cash flow and avoiding having to take out more expensive forms of borrowing. These are some tips to make the most of 0% Credit Card Balance transfers

Don’t wait until you Need To Borrow Money

If you suddenly need to borrow £3,000 it is easier, if you have already a balance on a credit card of £3,000 at 0%. Make big purchases on a credit card and transfer them to the credit card which is offering 0% for balance transfers.

Don’t Be Greedy

If you start to apply for many credit cards, you reduce your chance of getting approved. Don’t be greedy and try to manage several cards at 0% at once, just borrow what you need to improve cash flow.

Make Sure You Never Miss a Payment

If you are taking advantage of a 0% credit card balance transfers it is even more vital than ever to never miss a payment. Make sure you always pay off the minimum balance. I highly advise setting up a direct debit to automatically pay the minimum balance. This reduces the risk of forgetting or a cheque getting lost in the post (It also saves alot of time.) If you miss a payment the credit card company will invariably revert your balance to the standard rate and your credit rating will be damaged. (If this does happen try to fight it)

Make sure you pay off any purchases.

Note the 0% will be usually just for balance transfers. If you purchase on this credit card, you will have to pay off the purchase balance, otherwise these will get charged at usual rates.

Don’t cancel when the 6 month period ends.

It doesn’t look good to cancel a credit card as soon as the 6 month period ends. Sometimes after a few years, credit card companies offer existing companies another chance to transfer balances at 0%. This happened with my Egg credit card. Therefore, I was able to have 2 periods borrowing at 0% without having to apply for a new card.

Check Balance Transfer Rates

Most credit card companies now charge a balance transfer fee of around 2%. If this is the case try to choose a card which offers the longest period of interest free charges. 2% balance fee for 12 months, is effectively an interest rate of 2% - a pretty good deal for borrowing. 2% for 6months is effectively an interest rate of 4%.

See also: Mistakes of Using Credit Cards