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Balance Transfer Credit Card Applications• Click here to view all Articles... • Click here to view Credit Card eZine Archive... |
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[10/19/2007]
How to make balance transfers easy? The ads make it simple and convenient. Just transfer your hefty balance to a card with low APR and save. Can anything go wrong? Actually, yes, it can. Many problems can arise if you fail to read the whole agreement. So, it is better to take out your magnifying glass and read the fine print.
When you read through the credit card agreement, pay your special attention on several points. Among them: how long does the introductory rate last, what is APR after the introductory period, what are the fees and over-limits. When transferring balance you also need to look at some other aspects.
Balance Transfer Fees
This is another key factor. Some credit card companies charge a transaction fee that can be 4% from the balance. So, from $5000 the 4% fee will be $200. Some banks have a cap from $25 to $50. Some cards have no fee for only initial balance transfers. Other balance transfers look like cash advances for the card issuer and have high interest rtes.
As a lot of information is hard to understand, read the agreement several times. When it is very clear to you what are the fees, only then make a credit card application.
One Late Payment and Low Interest Rate Disappears
You should also realize that if you are only one payment late your percentage rate can rise from 3.9% introductory APR to 28.99% default APR as with Discover Motiva Card.
Once you have filled in the balance transfer form, wait when your balance is transferred. While you wait (that can be from two to four weeks) do not forget to make minimum payments on your old card.
When the balance is transferred and you received a zero billing statement, close the old account. This is good to avoid temptation to start spending money again.
Too Much Credit Hurts
If a person has too many open credit lines, he or she will likely face difficulties when applying for a mortgage or a car loan. Lenders view all these unused credit cards as a potential debt. So, they will hesitate when giving a loan or they will offer unfavorable terms and conditions.
Experts also alert not to charge this card. Low introductory rate can easily mislead and after the teaser rate expires a card owner can find himself or herself facing an even bigger debt.
Choose One Card and Stick To It
Credit card advisers suggest also that if you have transferred your balance to a card with low interest rate stick to it. At least for one year. It is no good to change cards quickly. That can damage your credit history significantly.
Well, if you transfer your balance to another card try not to forget that your aim is to get rid of debt. Not to acquire more. If at one point you understand that you cannot pay off your balance contact your bank and try to explain. Together you will be able to work out a solution that will suit both parties.
Copyright © 2008 www.acclaimsecuredcards.com. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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Balance transfer is a good way out if a person is intended to get rid of debt.
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