How is a low APR credit card better than 0 % APR... - Other Questions


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Credit Card Applications » Questions » User Questions » Other » How is a low APR credit card better than 0 % APR balance transfer card?

How is a low APR credit card better than 0 % APR balance transfer card?

Answered on | Updated on December 22nd, 2010
The content is accurate at the time of publication and is subject to change.

A lot of people are being attracted to balance transfer credit cards, especially for the shopping season. Interestingly, many credit card issuers are using this as an incentive to pull credit card customers using other credit cards. Most balance transfers are tempting offers, because they come with a 0% APR during the promotional period. This means those with higher outstanding balances can escape from paying the interest for a specific period of time, which varies between 6 to 18 months. That gives sufficient time for those with higher outstanding balances to pay off their debts.

However, given all the choices, credit card customers should also consider the low APR credit cards instead of the 0% APR balance transfer credit cards for several reasons. To start with, the 0% APR offer on a balance transfer might not be available on purchases. In such a case, credit card customers are often given the wrong impression by card issuers, who take the payments as balance transfer payoff, which means interest on the purchases made by the customer are charged. Secondly, most balance transfer credit cards starting out with 0% APR often have a very high interest rate once the promotional offer ends. This means that unless the credit card customer plans and balances his finances well, he or she is looking at high interests at the end of the promotional period if a balance is still pending on the account.

This could be quite a tricky situation, as one has to plan and implement the payments in order to pay off the debt on time. Hence, low APR credit cards are ideal in situations where the credit card customer has a reasonable outstanding debt. In such a scenario, a low APR credit card is a safer option, because the credit card customer doesn`t have to race against time. Although there would be interest on the outstanding debt from the first day, it balances out with the 0% APR credit cards in the long run. This is because the lower APR remains as such as long as one holds on to that account, and there is not interest rate increase. This is also ideal when unexpected expenses stop the credit card customers from paying off their debts. In the long term, they would be paying off less interest on their relatively larger debts.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
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