How to get the lowest credit card rate?

Credit Cards are a headache, especially when looking for the best rate. If you already have a credit card you can make the most of balance transfers to get a really low rate. When used right, a balance of transfer credit card can save you money. But without knowing what to do, it could end up costing you even more. Here’s how to maximise the benefits of a cc balance transfer.

Understanding the Basics

Every balance transfer offer, especially zero interest balance transfer credit cards, come with a special interest rate, typically a very low or even 0% rate. This promotional rate doesn’t last forever — it’s temporary, usually ranging from six months to two years. If you’re unable to clear the balance within this period, the remaining amount might be subject to a much higher interest rate.

Steps to success

Paying off the Balance: The allure of zero interest balance transfer credit cards can be tempting, but remember, it’s a race against time. It’s crucial to repay the transferred amount before the promotional rate concludes. Tools, like online credit card calculators, can help you determine feasible monthly repayments.

Smart Usage of the New Card: Once you’ve opted for a balance of transfer credit card, be wary of immediately using the new card for purchases. The interest rate for new purchases, known as the purchase rate, might be significantly higher than the balance transfer rate. Moreover, your repayments might prioritise these new purchases over the transferred balance, leading to an unexpected accumulation of debt.

Managing Old and New Cards: After completing a cc balance transfer, it might be wise to cancel the old card to avoid the temptation of racking up more debt. However, do this judiciously, as multiple credit card applications or closures can influence your credit score. Always make decisions with an eye on your credit health.

Selecting the Right Transfer Card: When you’re hunting for the credit card best for balance transfer, it’s more than just looking at the introductory rate. Consider other factors like the transferable amount, post-promotional rates, any interest-free days, potential rewards, and associated fees. While comparison websites can be a useful starting point, always delve deeper to understand the nuances of each offer.

Additional Tips

Never underestimate the power of a simple reminder. Setting up notifications or alarms can be the difference between missing a payment and maintaining a pristine credit history. Additionally, if you find yourself considering frequent cc balance transfers, it might be time to reassess your financial strategies to protect your credit score.

Resources and Tools

There’s an abundance of tools available, from comparison sites to repayment calculators, to help you on your balance of transfer credit card journey. Using these wisely can ensure that you’re well-informed and prepared for every decision. We have included a really simple Credit Card repayment calculator below to help set repayment goals to pay off your card sooner. It can be used to see what you can afford per month and how it will affect your outstanding CC debt and how soon it can be paid off. By setting the rate to near zero (zero breaks the calculator) you can work out how much you will need to pay per month to maximise your balance transfer credit card and pay it off without paying interest.

Final thoughts

Credit card balance transfers, especially from zero interest balance transfer credit cards, can be an excellent tool for savvy cardholders looking to reduce interest payments. By understanding the way credit cards cards work and potential pitfalls of balance transfers, you can leverage them to your financial advantage.