Low Interest Rate Credit Cards- Start Saving Today
If you carry an outstanding balance on your credit card, you're not alone. Nearly 70% of Americans keep a balance on one of their credit cards from month to month. And many of these cards have sky-high rates, which add up to hefty amounts in interest expense. By switching to a low interest rate credit card, you can save hundreds of dollars in interest. Starting with great introductory offers, low interest rate credit cards help you get back on track while enjoying the benefits of a credit card.
Introductory Offers
Credit companies continually offer customers incentives to sign up for their cards. This often includes an initial 0% interest rate. Many low interest rate credit cards carry this 0% APR feature. It allows you to begin saving even before the low interest rate kicks in.
The interest-free time is yours to take advantage of. You can make purchases and pay for them over a period of a few months, with no additional cost. If you carry an outstanding balance on a different credit card, you can transfer it to your new one. Then pay off the debt during the 0% APR time period. Before you do so, though, be sure to check that the charge for a balance transfer is reasonable.
Significant Savings
Low interest rate credit cards allow you to save even after the introductory period. Consider the difference between a credit card that charges an interest rate of 9% and one that charges 20%. If you have a 9% rate and carry a balance of $2,000 for an entire year, you will pay $180 in interest. With the higher rate of 20%, the interest expense rises to $400. That comes out to a difference of $220, which is a considerable amount. If you apply this figure to the principal balance, you will be able to pay off the debt much more quickly.
Check the Attached Fees
When looking for a low interest rate credit card, you will want to compare the various offers. In addition to looking at the interest rate, check the fees attached to the card. Some low interest rate credit cards include an annual fee, charges for balance transfers, and other costs. If the interest rate is low but the other fees are high, your overall savings may be reduced. For this reason, it is important to compare the interest rates and the other costs.
Create a Payment Plan
Even with the savings you'll receive from a low interest rate credit card, it is wise to make a plan to pay off your balance. A simple way to do this is to check the minimum payment due each month, double that amount, and apply the extra cash toward the principal balance. If the payment due the following month is less, continue to pay the initial amount you chose. This allows you to reduce the outstanding amount in an organized, structured way.
Low interest rate credit cards are an excellent option if you regularly carry a balance. Over time, they can allow you to save a significant amount of money in interest expense. Check out your options online and then apply right away. You can take advantage of low interest rate credit cards immediately and benefits from the savings.
Copyright Ed Vegliante. Free online reprints of this article are allowed provided the resource box remains intact with a live link back to http://www.credit-card-surplus.com .
Low Interest Credit Cards – The Secrets To Getting Yours
Make no mistake, low interest credit cards are readily available from a variety of companies, but usually only to those with excellent credit ratings. However, the term low interest will be defined differently by different users as people who have worked through some credit difficulties may find that a rate they consider low may seem high to someone who has never experienced problems with their credit score.
You need to remember that credit card companies are in business to make money and when they eliminated the annual fees charged band in the 1980's and early 1990's, they needed other methods to produce the company's profit. Defaults on credit card bills adds to the cost of their doing business so their interest rates on charges are designed around the possibility of a person failing to pay their bill on time.
The low interest credit cards available to one section of the buying public, deemed exceptionally credit worthy often return little profit to the card company. It is the fees generated by those with a lower credit score and the high interest rates associated with their cards that produce a lot of their income. Late fees and over the limit fees however, contribute the most profit for the credit card companies.
Other Factors Determine Credit Card Interest
However, a person's payment history with the credit card company is not the only factor when looking for low interest credit cards. A person who has a long history of timely payments, on time, may still see an end to their low interest credit cards if they default on another payment to another company. Missing a car payment may be interpreted by the credit card company that the person is at a higher risk of missing a card payment and that cardholder can kiss his low interest credit cards goodbye.
It's no secret that they key to maintaining low interest credit cards is to pay all the bills on time and in order to insure that remains possible, it is advised that people have no more than three different credit cards. It has been recommended that no more than two cards with low credit limits and one with a higher limit for emergencies be maintained. This will not only keep the total credit balance low, but offer a better chance that all the cards can be handled without financial difficulty.
Climbing out of a financial hole takes a lot of time and patience, but while paying off the high interest cards and their associated fees can be more palatable if the user keeps their eye on the proverbial carrots, which are low interest credit cards. After finally realizing financial liberation of the high cost cards, the person can be in a better position to continue building their score.
Where To Get Low Interest Credit Cards
Low interest rate credit cards can immediately improve your quality of life by freeing up disposable income. In other words, instead of spending hundreds of dollars every month on credit card interest, you can have that money available to meet important family expenses. Hopefully, some of the interest savings can also be used to pay down debt so that you are debt free sooner. These special offer credit card deals have been created to generate new customers for credit card providers.
Once past the introductory period, these new customers will pay interest on the balance and add to the profits of the financial institution. Most people don't realize that they do not have to follow this pattern. There is nothing to say that you cannot continue to transfer your credit card balance to a new zero rate card at the end of an introductory period. In this way, you would never have to pay interest on your credit card balance.
Low interest rate credit cards which charge low balance transfer fees and provide long zero interest introductory periods offer the best value. When you transfer credit card balances to these cards, you will receive significant financial respite. You will benefit immediately, in the short term and also in the longer term. So it is definitely worth taking the time to find the best cards for balance transfers.
The longer the zero rate introductory period, the more benefit you will receive. Even if you plan to transfer the balance to another interest-free card, an introductory period of twelve months or more means you will not be burdened by constantly having to go through the process of finding and applying for a new card. You will only have to do it once a year and maybe even less often.
The easiest way to locate low interest rate credit cards is to use an online credit card transfer service. These services have already done the hard work of evaluating different credit card offers and present the best deals for your consideration. They also provide online credit card application facilities which make applying quick and convenient. The better services also provide the opportunity to receive a reminder when the introductory period is about to expire so that you can transfer the balance to yet another low or zero rate card. This alert service can jolt us into remembering that we need to act quickly or we will once again have to pay interest on credit card debt.
If you want a quick and easy way to consolidate credit card debt or simply reduce monthly costs so you have more disposable income, it's worth considering low interest rate credit cards (particularly if the interest is zero). Credit card debt has become a major burden to many families, especially with increasing costs of living and slow wages growth. Transferring credit card balances to low interest rate credit cards for periods of twelve months or more at a time, is a way to save on high monthly interest costs and ease stress on the family budget. If you are able to use some of your additional disposable income to reduce the credit card balance you will have the added benefit of getting out of debt sooner than you would otherwise be able to do.
Low Interest Rate Credit Cards The Hidden Traps
While low interest rate credit cards are not currently very common there may well be lots of low interest credit card offers hitting your mailbox in the next three to nine months, as the banks and lending institutions eventually get bailed out of their bad loans by the Federal Government, and then start competing for the revenue streams that credit cards represent.
Here is a simple set of guidelines for you to keep in mind as these offers come pouring in; nearly every single one of the guide lines boils down to common sense and reading the fine print, and they all come down to understanding how interest works and how banks make money off it.
When you have a credit card, it has an interest rate, expressed as a percentage. This is the percentage of your annual balance that is charged as a usage fee every year by the bank. For your convenience, it's applied monthly. For example, if you have a card with a 12% APR interest rate, and borrow $1,000 on it as your average balance, you'll bay $120 in interest on the loan.
Every credit card has a grace period; this is the period during which if you pay off the balance, no interest accrues. One of the things to look at carefully in a low interest credit card offer is how long the grace period is. Typical grace periods are in the realm of 25 to 35 days; longer grace periods are better than shorter ones from your perspective. Some low interest credit card rates set their grace periods as low as 14 days after the purchase - even if they wouldn't run another billing cycle in the mean time!
The reason why grace periods are important is because the way to minimize the disaster of bad credit management is to pay off your credit card bills in full, every month, just like you make your car payment every month. Keeping a balance means you start accumulating interest, and the rule of thumb on interest is that it always makes everything more expensive. The mathematical rule of thumb on interest is called the Rule of 72. Divide 72 by your interest rate, in points, and that's the amount of time it takes for the cumulative interest payments to equal the average balance you had on the card.
Some low interest rate cards have an introductory rate, typically 2-3%. If you have an outstanding balance on another card, and have an intro rate offer, look into transferring your high interest balance to the low interest card, and working out how much you have to pay each month during the introductory period in order to pay off the entire outstanding amount. Look at it as a way to get yourself out of debt, not as a way to get more money to spend, and you'll be safer. Pay attention to what the interest rate will be when the introductory low rate ends, and look at annual fees. Also look into what the interest rate changes to if you're ever late with a payment. Most credit card companies run their rates up substantially in that set of circumstances.
As with all financial services options, look at low interest credit cards in context. Be sure to compare the various offers, make sure that what you're getting is, in fact, the best deal for your situation, and work responsibly with your credit to build up a good credit history, so you can keep a good credit history and when you want to buy a big item like a house or a car you can get the credit you want easily.
Low Interest Credit Cards Vs High Interest Rate Credit Cards
There are a lot of kinds of credit card plans and types nowadays that things have become very confusing for the average consumer. But no matter how many types there are, the most sought after type of cards are still low rate cards. Usually, most people tend to favor low interest credit purely because of its name. This is because in terms of finances and payment schemes, people tend to assume that low interest is automatically good. But in the case of low interest cards, there are various pros and cons that should be considered outside of its very appealing name.
By definition, low interest credit cards are exactly what their name says. Credit card that have low monthly or annual interest rates. How low they are depends on the bank issuing them, as there is a multitude of companies that offer low interest credit.
It is important that you never consider low interest cards as the perfect credit card solution as a whole, since it will depend largely on the individual needs and requirements as to whether it is the right card for him. As with everything, there are certain advantages and disadvantages with low interest cards.
For example, for people who frequently make small purchases these low rate cards may not provide you with enough rewards, particularly because most of the low interest rate cards have few or no promos, rewards or incentive programs in order to make up for their below average interest rates.
People who pay their credit card debts religiously and on time may not have much use for the cards. In fact, these types of credit cards are highly impractical for people who are good payers, due to the fact that they're not being able to take advantage of the interest rates for paying on time, and that they are missing out on rewards and incentives that would have been due them, if they were using higher interest rate cards that have exceptional reward systems for good payers.
Typically, owners of higher interest rate cards who make frequent purchases but pay in time or in full before the due date will either not experience the interest at all or will be able to make up for the high rates by offsetting it with the rewards that they earn. These rewards run the gamut from airline tickets to merchandise, to store credits and even rebates or cash-back promos.
It is therefore important for a person who wants to apply for a credit card to do some research by browsing websites pertaining to credit card types, and shopping around for different credit card companies as well as their respective plans. He should also check first and assess his needs in order to estimate future purchasing habits and patterns, so that he can decide whether a low interest rate card would be beneficial or if a high interest rate card would be more practical.
Low Interest Credit Card
Low interest credit cards are quite possibly the best bargain of the credit card industry. Low Interest Credit Cards are great for those who plan to carry a balance on their credit cards longer than six months. Even doing a balance transfer can pay off assuming the fees associated with it are more than absorbed by the higher monthly interest you are paying on your current credit cards. Low interest credit cards are therefore a good way of settling credit card debts. The only way to know if low interest credit cards will save you money in the long term is to look at your own credit history and start crunching the numbers. If you have multiple credit cards, that difference can really add up.
There are many other low APR credit cards available to choose from, according to your individual financial needs. Clearly one of the most important considerations when looking for a new credit card is the interest rate. Low interest credit cards are always tempting, particularly if they are coupled with an incredibly low introductory rate (a common tactic). For some people, interest rate or the APR is probably the most important thing to look for when selecting a credit card. Therefore it is important to find out what the long term APR is on any given credit card. You also need to discern whether or not the zero percent introductory rates are just for balance transfers or include purchases made during this period, and it will be well worth taking your time to understand all of the terms, rates and fees in order to find the best balance transfer credit cards that suit your financial need. If you have a good credit rating, you shouldn't have much difficulty qualifying for low interest credit cards.
Cash back is a feature of credit cards that is rapidly growing in popularity. The single, most important, reason credit card issuers are doing this is because people prefer to get cash back over any other type of credit card incentive. You can earn cash back rebates and other cash incentives when you use one of these credit cards. Cash Back Credit Cards a range of cash-back credit cards including those for students, businesses & those with damaged credit.
Transferring balances from high APR charge cards to low rate credit cards is one of the very best ways to keep your hard earned money where it belongs. Once you have transferred your balances over to a new credit card it is vital to pay your bills in full and on time, if you want to keep great rates and all your rewards benefits. Balance transfer credit cards don't tolerate late payments, so if you miss out on a particular repayment all the benefit is lost and instantly the high regular APR's are applied. And, for those not able to "service" this debt in the form of making the minimum payments or are just a little forgetful, late payments can rear their ugly heads. In such continuous non-payments the interest rate usually accumulates and the total amount due becomes large. So, even if you don't plan to be late with payments, make sure that the card holder agreement does not provide strict penalty clauses for one late payment.
Let's face it, a lot of credit card providers are offering a 0 balance transfer credit card, so you are probably looking for a 0% balance transfer credit card that stands out from the crowd. Ultimately, it can be said that a good low interest rate credit card is one that lives up to its name and at the same time offers a host of other services at a low cost. Low interest credit cards are the best choice when looking for a credit card that will work for you.
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