Tuesday, September 28, 2010
The Facts about Low Interest Credit Cards
So what are low interest credit cards really all about? The following article includes some pertinent information about low interest credit cards --info you can use to make wise financial decisions. Trying to save on interest expense? Apply for a low interest credit card and start saving money by paying less interest expense. Low interest credit cards are considered cheap credit cards because they offer 0% Intro APR (annual percentage rate) up to one year. These offers may only apply to the balance transfer and not to new purchases and cash advance. Therefore, making purchases and taking cash advance with your promotional offer credit card may result in paying multiple interest rates. Individuals who are planning to make purchases and carry a credit card balance each month may be better off with low fixed interest rate credit cards. Customers will need to decide if a 0% intro APR or a low fixed APR credit card is better suited for their personal needs. It’s not uncommon for the interest rate to shoot up dramatically after the introductory period expires. Therefore, customers should know what the interest rate will be after the promotional period ends. The promotional offer or interest free period can save hundreds of dollars in interest expense. During this interest free period no interest is accrued if the account is in good standing. Customers utilize the interest free period to transfer balance from high interest rate credit cards to a low interest credit rate credit cards to save money on interest expense. These cards are also very important for customers who are planning to consolidate credit card loans, make large purchases and carry a credit card balance from month to month. Credit card issuers charge a fee to do a balance transfer. This fee varies from bank to bank so it is a good idea to shop around for the best deal. Individuals with excellent credit score can ask to have the fee waived. Banks and credit card companies competing for the low interest credit card business offer impressive features similar to standard credit cards. Similar features may be cash back, rewards, bonus miles, no annual fee and more. Therefore, comparing credit card features is very important because it allows you to find the card that meets your lifestyle and one that will save the most money on interest expense. The best way to save interest is to pay the outstanding balance off each billing cycle. Credit card companies usually waived the interest charges if the entire outstanding balance is paid on time each month. If the outstanding balance is not paid in full each month then the credit card companies will charge interest on the entire outstanding balance from the date of each purchase. Many customers are not financially able to maximize their interest savings by paying off the entire balance each month. Therefore the next best way to save on interest expense is to use a low interest credit card to make purchases and carry an outstanding balance. It’s a common situation for individuals with bad credit to pay credit card companies large fees and finance charges. This situation keeps them indebted to the credit card companies if no action is taken to improve credit score. However, individuals with excellent credit can apply and get approval for a low interest credit card and avoid the burdensome situation of high interest rates and fees. Credit card companies have the option to change the interest rate on your credit card for various reasons such as making late payment, applying for too much credit, making late payments on different accounts or they can change it without any reason at all. Therefore, understanding credit and how to use it wisely is very important. Low interest credit cards are ideally suited to consolidate credit card debts because of the 0% intro APR or low interest rate offered. It will make monthly payments more manageable and can alleviate the financial problems that come with having too much credit you can’t afford. This is an opportunity to get your finances in order and to start managing your credit more wisely. Having less credit card accounts will simplifies your life and eventually improve your credit score. It’s much more convenient to write one check instead of writing several checks each month to various creditors. Debt consolidation is an excellent opportunity to keep you out of bankruptcy and get your finances back on track. Learning about grace period as it relates to your specific credit card is very important. The grace period is between 20 to 25 days. You have this free period to pay no interest if your payment is credited to your account during that time frame and your account carries no balance. Customer’s monthly payment must be received by the creditor during this time frame. Learning about grace period as it relates to your specific credit card is very important. Usually credit cards without a grace period are charged finance charges immediately on new purchases even if your previous month's bill was paid in full. The internet is the easiest place to find low interest credit cards with online credit card application. Website like www.icreditonline.com offers various types of credit cards. The cards are grouped into different categories. Clicking on low interest credit cards will bring up a list of low interest credit cards. Customers will then be able to compare offers and submit their online credit card application for approval. The internet is very convenient and fast way to apply and submit your credit card application. No more waiting weeks to receive your credit card in the mail. Once approved your should receive your credit card by mail within a few days. Read your credit card agreement to find out if there are separate interest rates for balance transfer, new purchases and cash advance. Card holders maybe charged a very high interest rate and fees for cash advance or making new purchases while getting the 0% intro offer for balance transfer. Don’t let this happen to you. Take the time to read the credit card agreement. Reading and understanding the credit card agreement is of utmost importance because it gives you the knowledge needed to make the right decision.