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Nowadays, it is very easy and fast to secure a credit card. There are a lot of us though who are not able to manage our credit card usage thus leading to vary high credit card debts. For some, one of the best ways to reduce interest and save more money is to have a credit card balance transfer. This is actually true but it can still lead you to higher interest rates if you fail to pay off with your new company. With a balance transfer, social security number and mailbox is all it takes to apply.
Credit card business is considered to be one of the biggest. Credit card companies and banks make money out of the interest or charges paid by their consumers. A slapping sixteen percent is the usual annual rate for credit cards. So do your math. Check how much bans profit from our credit cards. When one fails to make the monthly payment, interest is added to its principal thus making it a little harder for one to pay off. This is where balance transfer enters the scene.
A Balance transfer offer is one of the business tactics of most banks and companies to attract the public use their cards. All of your debt from your old card is transferred to your new credit card. With your new company, you re then required to repay them within the period provided to you. This is called the grace period or the introductory period. This said period usually last from six months to one year. While there are some banks who offer one or two percent interest rate, there are also some which give their new customers zero percent. The catch here though is that you need to complete the repayment within the grace period given to avoid higher interests and penalties. Failure to make the payment will only give you greater burden of a higher interest rate. If you think that you could be diligent enough to make the payment on time, then make sure to close all your existing cards before you apply for the balance transfer.
If you find it a little time-consuming inquiring from one bank to another then you have all the resources available online. If you`ve found the best bank with the best deal then you can also apply with them online for a faster process and transfer. To make you decide even more effective and easer when it comes to rates, then there are online balance transfer calculators that can give you an idea of how much you have to repay monthly. This is also a good way for you to know whether you can financially manage the transfer.
Most of the drawbacks that come from using balance transfer are due to the lack of research. You should know all the things about balance transfer, even to its littlest details to avoid more penalties and higher unexpected interest rates.
Ask, ask and ask. That`s the secret for finding the best.