Balance transfer credit cards are a great way for many cardholders to decrease their debt while freeing up extra cash for other expenses. Here's how these unique and convenient cards work. They usually come with a 0% APR offer that may go for as long as 15 months. You take the balances off your other high interest credit cards and put them on your new one and make monthly payments without having to pay interest. Unfortunately, many consumers make the mistake of getting this card with the intent of helping their financial situations only to begin using their old ones again and winding up in the same situation as before. Do not let this happen to you. Let your new one help you with your debts and not just become an additional debt you have to pay. Here are some tips on how you can get the best out of them.
Make sure you fully understand all the terms and conditions of the card, including the fees and charges that may occur. Read all the fine print; do not assume that all are the same. If you do not understand something you read, call the customer service number that's included with the card or brochure. Be sure that you fully understand how long you'll have the 0% interest rate and what it will be after the introductory period.
Close out all your other cards. If you got the balance transfer, you got it to decrease your monthly payments and help your finances. Having old credit cards lying around with zero balances may be too much of a temptation so get rid of them. Before you close out the account, however, make sure the company is showing you at a zero balance.
When you begin making your payments on your new one, always try to make more than the monthly amount that's required. The purpose of this new card is so you can pay off your debts without having to pay interest and the best way is to pay more than what's required. Doing it this way, your balance will be paid off by time the 0% APR period has expired and you will not have to pay a higher interest rate. Be a responsible shopper and look over your bill every month to make sure there are no errors and you'll soon be on your way to being credit card debt-free.