Compare 0% Balance Transfer And Purchases Credit Cards

January 18th, 2010

If you want to transfer balance from one of your credit cards to a new one then you should first compare 0% balance transfer and purchases credit cards to see which ones give you the best deal.

If you want to transfer a balance from a credit card you currently own over to a new one, and you will want to make purchases on your new card, you are best to compare 0% balance transfer and purchases credit cards. They are suitable for both making a transfer and spending on purchases. As long as the time period for the purchases and balance transfers are the same, you will save money.

If you want to do a balance transfer and not make any new purchases on the card then you should get a 0% balance transfer credit card. This type of card has a much longer 0% time period on a transfer.

If you want to only make purchases then you should choose a 0% purchase credit card that gives you up to 10 months of purchasing at this rate. This is a longer time period than an average 0% balance transfer and purchases credit card offer.

You should always remember that with any of these cards, cash withdrawals become trapped and start accruing interest right away, and you are not able to pay them off until you have completely repaid your 0% balance.

Compare 0% balance transfer and purchases credit cards:

If you use these cards wisely they can save you a lot of money. They can give you more time to pay off your debt without adding on any extra interest. Part of using them wisely is understanding all of the terms and conditions of the card fully.

When you compare 0% balance transfer and purchases cards, you need to check that the card has the same expiry date for the 0% introduction rate for both new purchases and the transfer balance. 0% balance transfer and purchases credit cards will almost always give you the same length of time to repay your balance transfers and purchases at 0%.

If you have a credit card that offers a 0% introductory rate for a shorter time period on any purchases you make, then you’ll run into a problem once this time period is up. Any purchases you have made up to the expiry date will be transferred to the higher interest rate. At that point, if you have not paid off all of your 0% transfer balance, all of your payments will go towards paying off this transfer balance, while your purchases with a high rate keep gaining more interest.

Credit card companies always allocate the payments to the lower rate, which in this case is 0%. Once this balance has been paid off then any future payments will be put towards any higher rate balances.

When you read the terms and conditions, you may also see that some credit card companies stipulate that any payments will be made to the longest 0% balance first. This means that absolutely none of your payments are going towards the newer balance you have started with your purchases.

Single use cards

Most credit cards are really designed for only one purpose, even though they may be advertised as offering many different features.

0% balance transfer and purchases credit cards are good for people that need to transfer a balance and make purchases at the same time. They are not very suitable for other common credit card uses. You should not use them for getting cash back at a supermarket, buying traveler’s checks or foreign currency, gambling transactions or for cash advances at ATMs.

You will have to pay a heavy price for these transactions including interest charges that are much higher and handling fees. Also, interest will build up on these balances until you have paid off your entire 0% balance.

Choosing the right card

Here is a list of items you should look for when you compare 0% balance transfer and purchases credit cards.

1. Find the card with the longest 0% time period

This will give you more time to pay off both your purchases and balance transfer without having any interest added. Your payments will go directly towards the balance, which will mean you can get your debt handled faster than if you had to pay off any interest along with it. You can really get caught up with your debt by using these cards. The longer you have to make these payments, the bigger chunk of debt you will be able to pay off. The Citibank Clear Platinum offers you a six month term on both of these criteria..

2. Look at the balance transfer handling fee

When you compare 0% balance transfer and purchases credit cards you will see a slight difference in the handling fees. Usually they run in the range of 2 to 3%. These charges are just a part of doing business, and when compared to the money that will be saved, they are worth the small cost that is involved.

3. Find out what is included in the 0% offer

Usually cash withdrawals will not qualify for the 0% time period. The balance amount of these withdrawals will end up trapped, acquiring interest, while your payments are used towards your 0% balance. As mentioned earlier, there are many other hidden fees with transactions other than purchases. If you make these other transactions you will not be making the best use of your card.

4. Find out how long you have to make the transfer balance

Some credit card companies only allow thirty days while others give a time window of up to three months. If you don’t get the balance transferred within this period of time you will lose out on the offer. You will need to move rapidly on this, using either telephone banking, online services or by filling out the balance transfer forms you were sent through the post.

It is important to remember that just because you have no interest does not mean that you do not have to make any payments. You must be very careful with this because if your payment is late, or you miss one altogether, you can lose the 0% rate permanently.

Editors Choice: Featured Credit Card Deals

	Interest Rate (p.a.)	Balance Transfer Rate (p.a.)	Annual fee	Cash Advance Rate (p.a.)
Westpac 55 Day Credit Card	0% for 5 months (reverts to 19.59% )	3.99% for 6 months	$0	21.49%
Citibank Clear Platinum Card	11.99%	2.9% for 12 months	$99	21.74%