Using a 0 APR Balance Transfer

What is a Credit Card Balance Transfer?

A credit card balance transfer offers a consumer the ability to transfer the outstanding debt of one credit card to another credit card. This maneuver is typically made when an individual has accrued massive debt on a credit card with a higher APP. In this situation, if approved, the individual will transfer his or her exorbitant debt to another card (typically one that was just opened) that contains a lower APP.

By executing this maneuver, the individual in theory, will save money due to the lower APP of the newer card; the remaining balance is no longer subject to higher interest charges that existed on the previous card. Additionally, the balance on an unpaid high-rate credit card may be paid off by using the credit line from another card with a lower interest rate or APR.

What is a 0 APR Transfer?

Using the above definition of a credit card transfer, a 0 APR balance transfer is thus a transfer conducted to a new card that contains no interest payments. The 0 APR balance transfer is thus regarded as a savvy maneuver to help reduce credit card debt and subsequent credit payments.

The outstanding balance of the old card, which was attached with interest payments, is transferred over to a new card that does not additional fees or interest payments. As a result, the lower the APR of a credit card, the more savings an individual will amass on the new interest charge.

Additionally, the balance on an unpaid high-rate credit card may be paid off by using the credit line from another card with a lower interest rate or APR.

How to Obtain a 0 APR Balance Transfer:

Before attempting to execute a 0 APR balance transfer, you must first compare the balance transfer offers in the given credit market. All credit card companies will use low-rate balance transfer offers as a means to attract new customers; the offers are primarily based on an individual’s credit history and the amount of their outstanding balance.

Those applicants with good credit scores are far more likely to receive a 0 APR balance transfer than individuals who have a shaky credit history. Additionally, a 0 APR balance transfer is typically offered with a set time frame; typically 12 months or longer.

An individual must also be cognizant of the fact that even though they may obtain a 0 APR balance transfer, there is always a fee attached to the maneuver.

To obtain a 0 APR balance transfer you must contact a credit card company. Once you have settled on a particular balance transfer offer, you must apply either online or by telephone. Although your existing credit card may offer a balance-transfer program, the majority of transfers are established from new credit card offers.

A credit card issuer will approve new applications based off your credit score, your annual income, your housing status, and your occupation. With that in mind, an applicant with good credit may still be turned down if the percentage of total income over debt is below a desired level.

Once approved for a 0 APR balance transfer, you may execute the transfer in two ways. When applying for a new credit card, as oppose to filling out the balance transfer form, you can request a balance transfer check once the application has been approved.

Once you receive the check in the mail, you may write it out to yourself and deposit it into a bank account. The money may be used for any purchase, without being impeded by any restrictions from the credit card issuer.

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