If you’re carrying a significant amount of credit card debt and paying a high interest rate, you may wonder if you can ever pay off your balance.
A balance transfer credit card offering a 0% introductory APR period may be able to help you dig out from your debt. Depending on the size of your debt particularly a card with a longer promotional person
Benefits of a 0% Introductory APR Offer
With a 0% introductory APR, you avoid paying interest on your balance for a specified period of time. By saving money on interest, you can pay your debt off faster by paying more towards the principal.
You only get value from a balance transfer credit card as long as you pay off your debt before the introductory offer expires.
If you don’t, the standard interest rate, which can be as high as 26%, will apply on your remaining balance. Your plan to eliminate your debt could end up putting you in more debt.
Qualifying for a 0% APR
To qualify for the 0% introductory APR offer, you will need to have very good to excellent credit. Be sure to check your credit score before applying for a balance transfer credit card.
If you do qualify for a balance transfer credit card, you can still lose the rate if you don’t follow the cards terms and conditions. With some cards, even one late payment can cancel the rate, forcing you to pay the standard APR on the remaining balance amount.
It’s also important to remember the length of time of the 0% APR offer is for a limited time. You will have to transfer the balance within a certain period of time (typically 60 days) after opening the account to qualify for the interest-free time period.
Read the card’s terms and conditions before transferring the balance to ensure you understand the qualifications for keeping the zero-interest offer.
Longest 0% APR Balance Transfer Credit Cards.
Zero-interest offers vary from card to card but generally they range from 12-18 months. However, there is one card currently on the market with a longer 0% APR offer – the Citi Simplicity Card with a 21-month 0% APR offer.
A longer introductory offer can be especially helpful if you have a extremely large debt amount and need longer time to pay it off. The difference between a 12-month and 21-month 0% balance transfer promotional period could mean hundreds or thousands of dollars saved on interest charges. In addition, most cards charge a balance transfer fee, which typically range from 3% to 5% of the amount being transferred. A longer 0% APR period can offset the balance transfer fee.