Why Choose a Balance Transfer Card?
The ease with which credit cards were available over the last decade led to almost all of the adult population applying for and carrying at least one card. Banks, keen to maximise their profits, were only happy to raise the credit limits of many maxxed-out customers, allowing borrowing to increase ever further.
In the constant fight for new customers, many banks also financed attractive introductory offers by pushing the rates for existing customers upwards, slowly but surely.
The outcome of all this is that there are now millions of people carrying a credit card debt on which they're paying unattractive rates of interest, often at rates way above those charged when they first took out the card.
Enter The Balance Transfer
Credit card balance transfer deals offer the opportunity to change this state of affairs. By applying and being accepted for a new card with a low or zero per cent balance transfer rate, you can shift the debt you've built up over the years onto an account with a much more favourable rate of interest.
This has two potential benefits, depending on how you want to use the card. Firstly, paying less interest means that you can reduce your repayment levels while still having the same effect on your balance, giving you some extra cash in your pocket each month.
Pay Down Debt
Alternatively, you can use it as an opportunity to pay down your debt more quickly by keeping your repayments at the same level, as more of each repyment will go towards reducing the balance rather than paying interest charges.
Either way, transferring your current balance to a new home will be a start in tipping the financial scales back into your favour!
Site is for information only and does not constitute financial advice. E&OE.
