How Long Is Your Low Rate Credit Card Fixed For

The thought of a low fixed rate credit card will be very appealing to many. Borrow money off a lender and pay the exact amount back without incurring any interest charges. With the majority of banks now offering fixed 0% APR credit cards for new customers, more and more people are now finding themselves very attracted to the temptation of their banks lucrative deals.

All of these deals will not be so sweet forever, little or no interest rates will soar and without preparation, you could be subject to very high interest rates and find yourself financially out of control. When the 1st lender to offer this deal, they provided people the opportunity to transfer all their debt with a 0% interest rate on balance transfers. This fixed interest rate lasted for only 6 months due to other companies being keen to stay competitive. As you cannot go lower than the 0% interest rate, the only thing you can differ was the time period it stays 0% for which was competitively extended. Some U.S and U.K credit card companies now offer interest rates for a ridiculous 16 months. This kind of time period could help you transfer all of your balances to it and start knocking down the balance with larger payments saving you hundreds of dollars on interest. With any offer, you will need to check when the interest rate is set to rise so you can compare your quotes thoroughly, do not go for the 1st one you see.

For lenders to be in a position to offer such great deals there will always be a drawback which has to somehow generate their revenue. Generally, this will be when people withdraw cash, request statements or take part in any form of general banking which would normally cost nothing at a standard bank account. Do not think that transferring your balances from other cards is free either. The credit card companies can find out if you have a history of transferring balances from credit cards. What they do is offer you a low rate credit card with the 0% APR but charge you a one time transfer fee. This fee is usually 3% of the balance or up to $75. It depends on the card issuer but if you have a credit card balance of $7500 that 3% is a $225 one time charge. This should be treated the same as interest and some times it does not make sense to transfer the balance. Do the math first to see if transferring balances to a fixed rate credit card makes sense.