There are various credit card offers available. If you are an extensive credit card user, you are likely familiar with the different types of offers and rewards. One widely publicized credit card is the zero percent interest cards. You need to start by credit rating check to determine if you are eligible for some loans and interest pays. Although these particular credit cards have several perks, they also have certain advantages and disadvantages.
Types of Zero Percent Interest Credit Cards
When applying for a zero percent interest credit card, it is important to know which charges qualify for zero percent. For example, if applying for a balance transfer with zero percent, the low introductory rate only applies to the dollar amount transferred from another credit card. On the other hand, some zero percent interest cards apply to new purchases.
How Zero Percent Interest Credit Cards Work
Zero percent interest credit cards are just like other credit cards, the only difference is that these cards come without the high interest. Zero percent cards are not permanent. Most credit companies offer the introductory rate for 12 – 15 months. During this period, all monthly payments are applied toward reducing the principle balance. Some might need a credit rating check to see if you can be approved and offered reasonable rates.
Applying for a zero percent interest credit card has several advantages. However, these cards also come with certain pitfalls. For example, if obtaining a credit card with a low introductory rate, timely payments are extremely important.
Some credit card companies allow a few mistakes. On the other hand, credit card companies offering zero percent will not tolerate irresponsible credit users. For example, if payments are a day late, the credit card company may revoke the introductory rate period and charge a much higher rate.
Benefits of Zero Percent Interest Cards
If hoping to consolidate and reduce credit card debt, zero percent interest credit cards can help. Because interest is not applied for the first 12 – 15 months, you can easily combine all credit card balances onto one card, and dramatically reduce the balance. Moreover, zero percent interest cards are perfect for financing home improvement projects or taking a vacation. To avoid paying higher interest on purchases, the key is paying off the credit card before the introductory rate period ends, and make sure you had a credit rating check.