Credit Card Balance Transfer Offers

Indeed, credit card companies will do whatever they can to compete with each other. As one company thinks of better strategies, features, and other programs, another will conceptualize apparently better offers that greatly exceed those of its competitors.

Interest rates are the favourite points of competition of most providers. Each one has its own claim of what a better interest rate is. As soon as the enrolee has been convinced, he will then be encouraged to avail of the balance transfer offer. But are these types of offers really beneficial?

Balance transfers in credit cards happen when you transfer your bills from another credit card to another one which claims to impose lower interest rates.

However, in doing so, you must take extra precaution. While the procedure appears to be that straightforward, there are a lot of things that you have to take into consideration first.

First, you have to check if the low interest rates in the other credit card will, in fact, persist. More often than not, providers lure customers by giving a very low introductory rate. A few months after, higher rates will start to take effect.

Thus, before you decide to transfer all your balances to one credit card which apparently has lower rates, make sure you have read the fine prints in the documents being presented to you.

Oftentimes, the not-so-favourable conditions are contained in that portion of the form. Think twice before you do sign. Otherwise, you might end up paying higher than before.

If in case it was indicated early on that the low rates are, in fact, introductory and that they will increase after some time, inquire how much it will be and if it will remain to be so. When you know the exact figures, you can accurately weigh out your options.

Moreover, before closing your other credit cards and sticking to a new one, check if the low rates are for all parts of the bill. Sometimes, the low rates are only for those which are balance transferred. New purchases may have a different rate. If this is the case, you may avail of the balance transfer offer but use your previous credit cards for new purchases.

Some credit card companies also consider balance transfers as cash advances. Thus, the rates may be a lot higher. Inquire about the new credit card's classifications as well as clarify the titles of their various programs and features. One term may mean differently for two providers.

In addition, balance transfer may indeed have lower interest rates as well new purchases. Your inquiry should not end here, though.

You also have to look into the annual fees, late fees, finance charges, and other similar considerations. You may have saved a good amount by transferring your balance but you may end up paying higher fees than before. Weigh which one will be more cost-effective for you.

If in the end you have weighed your options well and decided on transferring your balance to another credit card, check with your old credit card if your balance with them has indeed been removed.

This is just to ensure that you will not be stuck paying two bills for the same purchases. Coordinate closely with your former and current provider to avoid any mix-ups.

Balance transfer offers may indeed be beneficial if reviewed carefully. You have to make sure, before making any decisions, that such is not another catchy credit card offer to guard yourself from.

Important Note:
View our recommended reference list, please visit this page: 0 Balance Transfer Credit Card Offers

Balance Transfer Credit Card Comparison and Reviews
http://reviews.ecreditdirectory.com/categories/balance_transfer_credit_cards

Zero percent Balance Transfers can damage your Health

What you are about to read may make you reassess your attitude to zero interest balance transfer offers. I will show how these balance transfer offers are pushing more and more people into serious financial difficulties and I will suggest a few ideas on how you can manage your debt better.

Credit card debt is rising at an alarming rate and many people are now getting into serious financial difficulties. One of the reasons is the promotion of no interest balance transfer offers and interest free initial periods.

Like most people, I've been tempted by the these offers to change my credit cards. I've taken them up on their offer and moved my credit card debt and, for a limited time, had no interest to pay. But "just in case of an emergency" I usually hang onto my old card.

Then something happens, an unexpected bill, or a wedding or birthday gift I've forgotten about. "Never mind" I tell myself "I can put it on the old card - there's plenty of credit on there so it's no problem."

A few months and a few unexpected bills later the interest free period runs out I have to pay interest on both my new card and the old card. Now I'm worse off than when I started but that's no problem as I can look for another card offering another interest free period and zero interest balance transfers.

It's so easy and the banks and credit card companies are so eager to lend the money that it becomes routine, until that is, something goes wrong. You could fall ill and be off work, or, you could lose some overtime and your wages fall, or maybe that big deal you were relying on falls through.

It may just be that the credit card companies decide you have too much outstanding on credit cards and you would have difficulty paying the repayments, or simply they spot that you are a regular churner of the debt and they don't want your business.

Whatever the reason the result is that you have all the interest to pay and you start to struggle with the minimum payments and miss one or two. Because you've missed payments it becomes even more difficult to find the next interest free balance transfer offer.

Now you have a real problem but it is one that can be avoided.

I could suggest that you don't use credit cards but I suspect that would not be acceptable, and I am not going to suggest you ignore the 0% offers - that would mean you paying interest when it is not needed.

The simplest way to benefit from these balance transfer offers, but keep your card debt under control, is to cut up your old card when you switch to a new one.

That way you benefit from the 0% offer but minimize your exposure to higher debt.

Once you have cut your card up though, it is essential that you contact the card issuer and close the account. Until you close the account the card issuer will continue to tempt you with special offers to use your old card.

Another tip is to never pay just the minimum payment. Always pay the maximum monthly payment you can afford. Reducing your payments simply pushes back the time when you have to repay and in the long term increases your payments. Use the interest free period to reduce your debt to the minimum and if possible clear the balance.

Credit card companies don't offer an interest free balance transfer because they are feeling generous. They do it because, in the vast majority of cases, they will be able to charge you more in the longer term. Use interest free credit to benefit you not the credit card companies.

John is 51 and lives in Manchester in the UK. He spent many years in insurance and finance now writes full time for a number of web sites. Go to Credit Card Debt for more information on how you can get the best from your credit cards.