As the competition among credit card issuers increases, more and more credit cards today are advertised either with a low rate or zero interest rate.
But before you sign up for a zero-rate offer, read on this article and find out the important points that you should consider.
Why Zero Cards Are Popular in The Market
Who wouldn’t want to own a credit card and be able to use it to pay bills without incurring interest rate charges? Yes, not paying the APR can save a credit cardholder a considerable sum of money.
In response to the growing demand in the market, credit card companies use this strategy to attract more customers. Some issuers offer 0% APR on balance transfers which are great for those who have outstanding debts in multiple credit card accounts. Nevertheless, the zero interest will not last forever. In fact, the zero interest may not stay for a very long time.
Typically, you can enjoy the zero interest rate within 6 months while some issuers offer up to 12 months introductory period. When this period expires however, you should be well aware of how much interest rate you will be charged. Will the APR be reasonable or will it be unreasonably high?
Zero Interest Rate on What?
How much will the APR applicable to new purchases be? BE careful on using your credit card on new purchases as you may be surprised to learn that the zero interest rate actually does not apply to other transactions, except on transferred balances.
Don’t forget to check out the rest of the fees such as the annual fee, balance transfer fee, late penalty fees, etc. Keep in mind that everything you need to know about a credit card should be disclosed in the Agreement so you must take the time to read and understand the fine print.
Yes, it’s exciting to apply for a credit card with zero interest rate. You have every right to consider owning a credit card with this offer. Nevertheless, you can only reap the benefits if you would be making the right credit card choice and if you know how to manage your account responsibly.