Low interest balance transfer credit cards are promised by most credit card companies saying this is the solution to your problems. They tend to offer low interest rates even as low as 0% to get customers to sign up with them. Some even offer promos and other arrangements like free watches in signing up and a lot more. These are great deals but like all companies they do not do things for free after all it will all come down to business. Before judging if getting low interest balance transfer cards are helpful or not, it is best to know more about it, how it works and why people sign up for it.
Basics on low interest balance transfer credit cards
From the words “low balance transfer”, we can already tell that these cards deal with the transferring of balance dues from one card to a different card. And why would you want to move your balance dues? The answer to that is cost cutting. These cards offer a lower interest rate that makes it appealing especially to those who have big dues.
With the rise of expenses in the market, these cards have become one of the major businesses of today. Companies earn large amounts of money through interest charges. Some companies have interests rate that are really high, some even reach 16% interest rate. Since this is consistently charged to the card holder, some card holders find it really hard to pay their dues and their balance charges gets bigger and bigger, then comes the low interest balance transfer credit cards. These allow customer to transfer their balance dues at a lower monthly interest rate which allows them to pay lesser than what they have been paying for every month with their previous company. Some even offer great deals and incentives once you sign in with them.
What do I get from low interest balance transfer credit cards?
Getting low interest balance transfer cards is a great deal. You get to save money since you pay lesser than what you have been paying for. With the right strategy you should be able to acquire great deals once you have signed on.
In choosing the right balance transfer card, look into the interest rates they offer and possible benefits or incentives that you can get in signing up. To get the best deal in signing up for low interest balance transfer credit cards, draw a comparison between other credit companies and their offers. Check your resources and make sure that you will be able to pay your new monthly charges.
What do companies get in offering low interest balance transfer credit cards?
Like all other businesses low interest balance transfer offered by credit card companies has a catch. Once you sign up, you will need to use and follow the promotion that they offered when you signed up. These companies also check your credit standing, if it is good then you get to make the most of it. If otherwise the low interest offered may not really be that low.
Aside from that, getting low interest balance credit cards may affect your credit score. In every instance that your balance would show above 30% of your card limit, your credit rating goes down. Plus if you have signed up for a transfer credit card that does not have available credit enough for your remaining credit which has to be transferred, then your credit rating would also get lower.
In these hard times, debt is something that we cannot do without. Getting low interest balance transfer credit cards may be the answer to our financial troubles but it is best to know what you are getting yourself into.