Many people wonder whether it is worth it to pursue a 0 interest credit card. With all the problems that almost every card holder has ever experienced with credit cards and the budding of unknown and hidden fees, we begin to wonder whether 0 interest credit cards are for real.
Well, 0 interest credit cards are for real, alright, but it is not necessarily what we think of. Some people mistakenly believe that 0 interest cards are those that have no real interest that can last for a lifetime. Others, however, believe that it is just a make-believe card and that it is impossible for any bank to give because the credit card companies wouldn't earn a cent.
At some point, they are true. But let us explain better what 0 interest cards are. This type of card does not have an Annual Percentage Rate during its first few months. The 0 interest rate is just an introductory offer that will last for a limited period of time. This limited period can last for either two months or 36 months, depending on the offer of the card company. After this period, the new APR shall kick in.
However, because the bank gets higher risk and earns nothing during the introductory period, they have set very stiff rules and conditions for a 0 interest card holder to follow. For instance, they may impose a late payment fee that is larger than usual to actually prevent you from sending delayed payments. Sometimes, they would even say that if you pay late, the entire 0 interest offer shall be wiped away. This can be problematic hence you have to make sure that you are prepared for such conditions.
Different credit card companies not only give different introductory period, they also allow different applications for your card. Some would allow balance transfers, which is good news for those who have big balances in their other cards. With 0 interest cards, you can transfer your balance and pay the debt off during the no interest period which accumulates no interest. However, not all 0 interest credit cards allow such transactions. Some would only allow the use of the card for either purchases or cash advance. All you need to do is research for the card that ultimately fits your needs.
Another advantage of the 0 interest cards is that you can get an interest-free loan. Whether you would need it to pay for your student loan, a micro-business loan or just for emergencies, this can definitely come in handy.
One reminder when getting 0 interest cards: never ever assume that this offer would last a long time; else you would be walking towards financial disasters. Either 0 interest credit cards can help you, or they will put you down. It is all up to you. Developing bad paying habits is the usual side effect of this card, but you can refrain from this by scheduling your payments and managing you accounts well. So, do you think 0 interest credit cards can work for you?