Just imagine a world where we could borrow money without the dread of repaying more in the long run than we initially needed to borrow. Sure, this is possible when borrowing from family or friends, but it puts a strain on the relationship with that individual and can destroy it all together. Believe it or not there is another option. With the help of a 0 APR credit card individuals have access to credit that does not include sky high interest rates. These cards a great option for those with good credit that need to make a big purchase, and for those with bad credit hoping to consolidate their debt and try to lower it.
If it hasn’t sunk in yet, it will soon. 0 APR credit cards are a reality and are offered by banks and credit card companies alike. As good as a 0 APR credit card is the interest free period does not last forever. The typical 0 APR credit card comes with an introductory period of six to 18 months during which there is no interest charged on the card. The features of any given 0 APR credit card can differ from lender to lender, but typical features include:
- 0 APR on purchases (during introductory period)
- 0 APR on balance transfers (during introductory period)
- Annual fee waived during first year
After the introductory period ends, the credit card you have chosen to go with will return to having an APR that is either a fixed rate or a variable rate. Fixed rate APRs remain the same year and after year and if the lender decides to raise the rate they must inform you according to Federal laws. Variable rate cards on the other hand have a fluctuating rate that is tied to some prevailing interest rate, such as the Prime Interest Rate.
Now that you are aware of 0 APR credit cards, what are the best circumstances for applying? The first thing to consider is that if you have perfect credit, no debt, and have no big purchases on the horizon it is not likely going to be worth your while to open up another line of credit with a new card. However, there are good reasons for applying for a 0 APR credit card and they include:
- Paying down debt faster
- Help with major purchases
- More attractive perks than your current card
One of the major reasons that individuals pursue a 0 APR credit card is the 0 APR on balance transfers during the introductory period. Those who have one or more credit cards with a running balance and a high interest rate can transfer their balance to a new 0 APR card, one time, and pay no interest on the balance transfer. This removes their debt from the high interest card and gives them time to pay down their large debt without more interest accruing, helping them stretch their money further.
Another typical reason behind getting a 0 APR credit card is to help make a major purchase. It is not uncommon for individuals to use a new 0 APR card to make a major purchase that they avoid payments on for a short period of time without fear of interest charges racking up. Examples of major purchases with a 0 APR credit card include:
- Big screen televisions
- Home remodels
- Vacations
A less common, but still existent, reason that some people switch to a 0 APR credit card is to take advantage of good offers and long lasting extra perks. Those with excellent credit and no debt may consider switching to a new 0 APR card with no interest charges because the card offers long term perks their current card does not. These perks include:
- Airline miles
- 2 points per dollar spent
- Points redeemable for travel, hotels, and merchandise
- NO annual fees
- NO foreign transaction fees
For help researching 0 APR credit cards, turn to Zerointerestcreditcards.com. Here you can not only research various credit card offers, but apply on the spot!