Zero interest credit cards

Zero interest credit card- sounds to be a good offer! These cards have created a stir in the credit card market . With most of the major credit card companies like Fleet, Discover, Citibank, American Express etc making these cards available these serve, as the most wanted credit cards . But dont get carried away by the term zero interest

Though zero interest sounds great but it is important that you realize in the beginning itself that this is not made available throughout the life of the credit card.These cards provide the zero interest rates only during the first few months of the card usage . The second important thing to realize is that these cards are not made available to everyone. If you have a good credit then probably you can qualify for these cards . It is very obvious that the credit card companies are not sitting to give a free deal.

Letssee what do the companies look at before approving you of the zero interest credit cards .

How do companies approve these cards?

As mentioned having a good credit history is a great asset that can help you in qualifying for these cards. But even if you have it you are not guaranteed of getting approved. There are many times that you would have made a late payment or would have opted for a balance transfer. This can cause a hindrance in getting you approved of the card.

When you opt to jump from one card to another in search of the free period or a lower interest the credit card companies would make out that you would not be with them for a long time. Hence they usually do not approve such people for a zero interest credit card.

Moreover during the underwriting process there are a number of factors that come into count like your employment status, income and your job stability. The credit card companies would not like to waste their offer on a customer who would not be able to meet their criteria and expectedly remain with them for a long time.

Read through carefully

Considering that you have managed to bag a zero credit card offer and have been approved of it. But before you sign up for the card it is important that you read the agreement carefully and figure out whether the zero interest-period is for balance transfers or purchases or for both these things.

You should also not forget to make sure about the expiry of your zero interest-period. Moreover make sure that you also enquire about the interest that you would have to pay once the zero-interest offer gets over.

If you find out that the zero interest is applicable only on balance transfers then you should avoid using the card for any new purchases. You should also have a look at the fees that the credit card charges before you sign up for one.

Zero interest credit card vs. low fixed interest credit card

When it comes to decide as to which offer among the zero interest and the low interest is the best then it becomes difficult to make a choice. In such a situation it is important that you consider your spending habits and whether you make your payments on time or not.

If you are a person who pays off their credit fast then you are better off with a low interest rate credit card because of the fact that you would rarely be charged the excess interest fees.

If you are a person who does not pay off your bills on time then you can opt for the zero-interest credit card. With this card you can save a lot of money till the offer lasts and hence reduce your debt load.

However consumers do not realize that the credit card companies make up for their loss by provoking you to use the new card for making newer purchases and taking the advantage of the zero interest on the balance transfers. But if your card does not offer zero interest on both balance transfers as well as purchases any purchase that you make with this new card would be charged a higher interest rate. Hence you would be accumulating a new debt.

The advantage of using zero interest credit cards

These credit cards are beneficial when you make a large purchase. When you buy a high priced item with your credit card then you would not have to pay any interest on the purchase and you can make the payments towards the principle of the amount.

For balance transfers the zero interest credit card is a great offer as you can pay off your previous bills without paying a high interest rate on your pending amount.

Also depending on your credit card provider the zero interest credit card can carry some rewards like cash back, travel miles etc.

Zero interest credit card offers

Some of the offers for zero interest credit cards that you can apply for are mentioned below.

Citi Platinum Select Card: They provide 0% APR* on balance transfers and purchases for 12 months and have no annual fee. The regular APR after introductory period is 11.24%.

Discover More Card: They offer 0% Intro APR* for purchases and balance transfers for 12 months and 5% Cash back Bonus on get more purchases in popular categories that change four times a year like home, apparel. They have no annual fee and the regular APR is 10.99%.

Blue from American Express®: With this credit card you can enjoy 0% APR for up to 15 months with low Balance Transfer APR 4.99% Fixed APR for the life of the balance. There is annual fee involved and you can enjoy different reward programs.

Bank of America Visa Signature® WorldPoints™ Rewards: They offer 0% Intro APR on balance transfers for your first 12 billing cycles and you can earn 1 Point for every dollar you spend in net retail purchases.