How to Get the Best Balance Transfer Deals
Saturday, June 5, 2010 18:26
Credit card offers are making a come-back these days with the new Credit Card Act settled into place and the lending market began to get improved slowly. However, although the balance transfer offers have rebounded, they are still not as appealing as they used to be before the credit crunch. It is very important to do the math before signing in for a deal.
For people who are looking to get the best balance transfers, here are a few tips.
First of all, you need to remember that almost all balance transfer cards come with a transfer charge now. So, you need to calculate the effective APR by annualizing the balance transfer charges in advance.
Secondly, you need to avoid “up to” offers, unless you have excellent credit. It means that you have to avoid any kinds of uncertainty. Be careful with the balance transfer, which offers that promise 0% APR for several months. When a credit card promises an “up to” period for the promotional rate, it means that only the ones with stellar credit can expect to receive the full benefits advertised.
Thirdly, you have to check the long-term card APR and calculate how much interest will accure. People, who can pay off their balance transfers within the promotional period, do not need to worry about the higher interest rate once the 0 APR intro expires. However, most cardholders, who make balance transfers will look at a long-term pay-off period.
Last but not least, you need to watch out for the influence on your debt-to-credit ratio, which is a significant part of FICO scores. It’s best to keep the debt-to-credit ratio at around 10-20%, and definitely below 30%.
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