Balance Transfer deals and an extra charge
The number of credit cards held by people continues to rise and rise. It is not uncommon now for people to have more than 3 credit cards in their possession at any one time. This increase has partly been down to the massive range of balance transfer deals available. Once someone transfers their current credit card balance to another card they often don’t cancel the card and will even sometimes end up using that card to for purchases they will intend to repay that month before the interest is applied to the credit card.
There are even many people out there who are paying interest on their credit cards at high apr rates instead of taking advantage of the zero apr available with many credit cards. This is just wasting money, as some apr on cards can be as much as 17 percent.
There are even a few cards that to grab customers are offering lifetime balance transfers, which eliminate the need to switch credit card provider every six to twelve months.
There are many great deals out there for consumers who take the time to look around at what credit cards are available but there can be pitfalls that trap the unwary and add to the cost of the card.
The pitfall lies with many of the cards that offer zero interest deals on balance transfers. Many of these credit card providers charge a balance transfer fee. This fee is regularly 2.5% of the balance to be transferred. So if you transfer £5,000 it would cost you £125.