Interest free credit cards look very attractive to anyone
looking for a way to save a few bucks. But beware of companies
that are offering too good of a deal since many have a lot of dirty
little details in the fine print. Most interest free credit cards
are offered to get you to sign up and may have a limited period of
free interest or other limitations. Here's a few very common
details to many offers:
1. Almost every offer I've seen has a limited time period for the
free interest on any balances. Usually this period of free
interest is 1-2 years.
2. All have a stipulation that if you are late on a payment, your
free interest is gone and they can access up to 29.99%. That's a
serious interest rate!!!
3. Some will offer free interest on balances transferred but not
any new purchases.
4. Few if any will tell you what your interest rate will be when
the free interest period is over, they just state it will be
between 11.99% to 20.99% depending on your credit worthiness.
5. Cash advances can be as high as 25.99%.
6. Any terms or conditions can be changed at will with 30 days
notice, no guarantee applies to any current terms!
7. Some may have stipulations that say if you don't use your
credit card you may no longer qualify for free interest.
Even though congress passed legislation last year to try and
eliminate many outrageous fees, charges, and changes to current
accounts without proper notice, the credit card companies have
already found ways around them. One small mistake on your part can
allow them to charge whatever they want.
Anytime you see small or gray type on any interest free credit
cards agreement, read that first. That will give you the real
story on the offer and any possible stipulations or possible
penalties for not adhering to their policies. Always check the
details before you sign any documents.
One thing to realize is the people the credit card companies
are targeting with interest free credit cards are those who have a
high balance. People who have no balance or small amounts don't
care about the interest rate, it's the people with high balances
that are their target group.
And these credit card companies are betting that many of the
people who sing up will either screw up and make a late payment or
worst case be highly profitable at the end of the free interest
period. These companies win now or later but they still win. Never
forget that.
I'm not telling you to not take advantage of these types of offers
if they will give you some benefit. I'm just trying to make sure
you know what you're getting into and read all the important
details.
Free interest credit cards can save you a huge amount of money
if you carry a large balance on your credit cards. Just make sure
you use the time allotted to pay those balances down and get out
from underneath your credit card debt.
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