The credit card industry is the competitive one; all you have to complete to see that is open your own mailbox. For many consumers, pre-approved credit card applications are available every week in the mail, often associated with offers to let you transfer a current balance from another credit card in a low interest rate. Sometimes these prices, known as "teaser" rates, can run as little as 0%, which can make applying for one of these simple cards rather tempting. Be careful, although. The fine print in the conditions of agreement on those cards could hide some very costly surprises. Here are some things to take into consideration in the fine print when you obtain a card with a low-interest introductory provide: Default rate - How high can the eye rate go if you fail to create a payment on time? This is referred to as the "default rate. " If a person pay late, your 0% or 3% rate of interest could rise to 30%. Make sure you realize.
Duration of the low rate - Just how long does this "teaser" rate apply? 6 months? Until you pay off the moved balance? Make sure you find away, as these rates often rise towards the regular rate that applies to the card after some limited time period.
Other debts - Does this card agreement possess a universal default clause? Many credit card companies will now raise your rate of interest if you make a late repayment on any bill, such as the telephone bill. Credit card companies declare that paying any bill late makes a higher risk customer. You don't want your rate of interest to rise because you forgot to pay for the cable TV bill, so study your terms carefully.
Other charges - These "teaser" rates apply and then transferred balances; they do not affect new charges. If you use the card to create purchases, those purchases will accrue interest in a higher rate. When you make obligations, the payments will be applied towards the portion of the balance with the cheapest rate first, meaning that these purchases might be accruing interest at the higher rate before you pay off your balance completely.
Any cause, or none - Most card agreements enable the company to raise your interest rate anytime, for any reason. All that is needed is two weeks' notice. Keep this in mind if you're transferring a large balance that may take you several years to repay. Sometimes, "until you pay off the moved balance " only means until someone in the corporate office changes their mind. As long when you are aware of the terms, these teaser rates can be very helpful. If you pay late or neglect to read the fine print, you could find yourself paying much more in interest. Read the agreement before you decide to apply for the card.
? Copyright laws 2006 by Retro Marketing. Charles Essmeier has Retro Marketing, a firm devoted in order to informational Websites, including End-Your-Debt. com, a website devoted to debt consolidation, individual bankruptcy, establishing credit and credit counseling as well as HomeEquityHelp. net, a site devoted in order to information regarding mortgages as well as home equity loans.
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