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Credit card companies are always looking for new customers and also to get customers to switch to their card from an existing one. Particularly when people find interest rates too high and unable to pay bills, they look for cards that are cheaper and a balance transfer appeals greatly. There are numerous companies that offer a 0 interest balance transfer. While all cards may not come with such a rate, there are also cards where there may be reduced rates ranging from 3 % to 6%. When you opt for such deals you need to also make sure that you have the low interest rate for a long enough time period to close the outstanding balance.
Many people worry that a balance transfer may affect their credit scores negatively. This is not true, only if the amount transferred to the new card exceeds 30% of the limit on it there will be such problems. You can use a balance transfer card for a year to close off the high balance accumulated, after which the card will have a rate that will be relatively fixed. Some balance transfer cards which have a 0 % interest rate will offer the same deal so long as the monthly payments are made on a timely basis.
When you look at doing a balance transfer offer, you need to also examine all the details involved in the agreement. With many clauses and introductory offers many people tend to read through the entire deal and are misled by the terms. You must also clarify what sort of rates are applicable following the introductory period on the card. If you are convinced you can get a good deal out of it and can save on your interest rates then you should do the transfer. There are also cards where the balance transfer fee is not there which makes it all the more attractive. However for all the terms to be higher favorable a good credit score is also important. There are also companies that offer balance transfer for consumers who have poor credit scores as well.
While you may find many promotional emails in your inbox, you may not be eligible for them easily. You will need to examine what sort of a deal you are eligible for before applying for a transfer. If you appear to be shopping for credit, it can also affect your credit scores negatively. You will also need to bear in mind that the lowered interest rates aren't applicable to any new purchases made using the card. If you think of this as a new line of credit and more money to shop you will find that you will get a higher interest rate on purchases and be back to square on with your debt situation.
Once your balance is transferred to the new card, also check that you close your old card. If the old card has been used for many years, you could keep it open as it is good for your credit history. However, going forward you will need to make sure that you only use it for minimum amounts and small purchases that can quickly be closed.
