Dangers of a Zero Interest Credit Card
Being able to qualify for a zero interest credit card is only one of the reasons why it's important to keep a good credit rating.
These card companies, like any other company, realize that they have to compete for your business.
But they also realize that in order to keep their bottom line healthy, they have to bring credit worthy people into their corporate database.
These people are the ones who have a history of making regular payments.
And they know that once they have these people as your clients, they can count on profits year after year.
But, knowing what these companies are looking for, gives you the consumer options as well, even if most consumers fail to take advantage of their options.
If you have good credit, in many cases you can virtually write the rules under which you agree to become a customer for a specific card company.
It's important for any consumer taking advantage of a zero interest card to recognize that the zero percent interest is simply a teaser rate.
It's meant to capture the consumer's attention and bring him or her into the credit company's fold.
And while the post-introductory terms offered by many credit card companies are fair, some really are out to take advantage of the consumer.
A perfect example is a credit card company that offers a zero percent interest rate, but once the introductory period is over, jacks the interest rate up to 21% or higher.
If you are one of the customers who transferred the balance on your 10% card in order to take advantage of the new company's zero interest credit card, you'll suddenly find yourself in a worse situation than you were before.
To avoid being taken, the best way to take advantage of zero interest card offers is to always pay off your credit card bills as they become due.
Don't carry over balances.
This way when the zero percent introductory period nears or is over, you can simply apply to another company for their zero interest card.
If you cannot pay off the entire balance in any month, make sure that you at least pay the minimum amount to avoid triggering "penalties" to your account.
Many credit card companies will automatically void your zero percent status if you are either late paying a bill or pay less than the minimum amount owed on the card.
Always read the mail that you get from the credit card company.
Many times these are notices notifying you of changes that the company has already made or are intending to make to your credit card.
You may find that the terms of your zero interest credit card are being altered to something that you don't like.
For example, you may suddenly find that your charge limits have changes, or that any charge amount over a specified dollar amount is now subject to interest fees.
Unfortunately, being diligent is part of the price you have to pay when you enter into contracts with financial entities.
If you want to be protected from future surprises, read your mail.
These card companies, like any other company, realize that they have to compete for your business.
But they also realize that in order to keep their bottom line healthy, they have to bring credit worthy people into their corporate database.
These people are the ones who have a history of making regular payments.
And they know that once they have these people as your clients, they can count on profits year after year.
But, knowing what these companies are looking for, gives you the consumer options as well, even if most consumers fail to take advantage of their options.
If you have good credit, in many cases you can virtually write the rules under which you agree to become a customer for a specific card company.
It's important for any consumer taking advantage of a zero interest card to recognize that the zero percent interest is simply a teaser rate.
It's meant to capture the consumer's attention and bring him or her into the credit company's fold.
And while the post-introductory terms offered by many credit card companies are fair, some really are out to take advantage of the consumer.
A perfect example is a credit card company that offers a zero percent interest rate, but once the introductory period is over, jacks the interest rate up to 21% or higher.
If you are one of the customers who transferred the balance on your 10% card in order to take advantage of the new company's zero interest credit card, you'll suddenly find yourself in a worse situation than you were before.
To avoid being taken, the best way to take advantage of zero interest card offers is to always pay off your credit card bills as they become due.
Don't carry over balances.
This way when the zero percent introductory period nears or is over, you can simply apply to another company for their zero interest card.
If you cannot pay off the entire balance in any month, make sure that you at least pay the minimum amount to avoid triggering "penalties" to your account.
Many credit card companies will automatically void your zero percent status if you are either late paying a bill or pay less than the minimum amount owed on the card.
Always read the mail that you get from the credit card company.
Many times these are notices notifying you of changes that the company has already made or are intending to make to your credit card.
You may find that the terms of your zero interest credit card are being altered to something that you don't like.
For example, you may suddenly find that your charge limits have changes, or that any charge amount over a specified dollar amount is now subject to interest fees.
Unfortunately, being diligent is part of the price you have to pay when you enter into contracts with financial entities.
If you want to be protected from future surprises, read your mail.
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