They couldn`t come back at a more perfect time. Zero percent APR credit card had disappeared from the market, to be replaced by 2.99% APR credit cards. These cards used to be profitable for banks when consumers didn`t pay off their debt in the allotted introductory time period. After that time period, APRs would jump to over 15%. Banks still have that opportunity to make that money if a consumer doesn`t pay off their debt in the allotted time, but more and more consumers are becoming aware of their finances due to the events proceeding to the Great Recession. This means that banks have had to make their offers more attractive in order to entice consumers. And they have done this by offering better promotions.
Many credit cards have begun offering longer balance transfer deals. While most of these cards used to have 12-month introductory offers, now it’s not uncommon to find a card with a 21 or 24-month introductory offer. More and more credit card issuers have begun issuing longer grace periods as well. Before, a single missed payment on your zero percent APR would mean the end of the zero percent introductory offer, and on to a higher APR. Now consumers, have a grace period of 60 days before creditor change their rate.
Also, these zero percent APR credit cards have more consumer protection. This is mainly due to Credit CARD Act of 2009 and it`s after effects. The Act gave consumers rights and protected them from certain injustices. Under the Act, zero percent APR credit card issuers have to do the same as other credit card issuers, and must warn consumers of interest rate hikes, hidden penalty fees and refunds for fraudulent purchases and services.
A zero balance transfer credit card is good for people who are dedicated to removing their debt, or for consumers who already have good credit and are just looking to move their debt onto one credit card. Also, the structure of these zero percent APR credit card has changed, before the Act these credit card were primarily structured for people who were already in debt, in order to further propel them into debt with hiked interest rates and frequent penalty fees. These new cards are marketed towards good credit consumers who already have good borrowing habits, and the after promotion APR of 15% is manageable for these consumers.
Zero percent balance transfer credit cards come with a variety of annual fees and expenses, so therefore, it`s still important to read the fine print, even though the banks have made these cards more beneficial for consumers.