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Research: The significance of zero balance transfers - Credit-Land.com

Balance transfers mean transferring the balances from one credit card to another where the dues are transferred from a high APR card to a zero interest card. There are a good number of banks that offer zero balance transfers from the old card to the new one. In some cases, balance transfers may also involve the transfer of funds from the bank loan account onto the card for a stipulated period of time. These types of loans typically have a low interest rate or 0% interest rates on them.

Most of us desire a card that has a low interest rate or 0% APR. But if you already have a credit card with high APR you could still do away with it by doing a balance transfer. Due to the stiff competition among the credit card companies and their desire to attract their customers, card issuers are making attractive offers on balance transfers. There are some balance transfers that have 0% APR or no interest balance transfers or they might offer credit balance transfer rewards.

Normally people opt for balance transfers when the outstanding balances on their cards remain in spite of making payments regularly. This is then transferred to a fresh card which carries no interest for a certain period of time. However, you must ensure that you should have at least paid the minimum due on the cards prior to doing the balance transfers. But you should not make balance transfers a habit especially if you have mounting debts.

Once you start rebuilding your credit history and create an atmosphere of trust then you may apply for no-interest balance transfer or 0% APR balance transfers. Typically, you will get 0% APR on the balance transfers for a period of one year. But there are some cards that offer the 0% APR offers for a period of 18 months as well. If you continue to maintain good credit and if you are well organized then you can avail the credit balance transfer rewards by closing the account before you are charged a higher interest rate.

There are various benefits associated with the no interest balance transfer but you must also be cautious with regard to any hidden costs or other handling charges that come with it. Ensure that your monthly payments are made on time or you will lose the benefits of doing the balance transfers and will end up paying much more due to the default rates that would be applicable.

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.