0 APR CARD FOR DEBT REDUCTION

2007-03-08 10:33:40

( Financial )



People who do not own a house can take advantage of 0 APR card to reduce debt. Credit card companies used this as an option to entice people with good credit standing to their services.

Credit card companies use 0 APR card as teasers for credit card owners to change credit card vendors. Annual percentage rate or APR is an amount computed on yearly bases to illustrate the cost of credit consumers must pay. APR in credit cards is computed based on the maintaining balance of your purchases which is expressed in an annual rate.

0 APR card will surely help you in reducing your debt if you use it meticulously. It is usually offered on a short term basis form six months to a year. In other words, it does not last. Consumers are advised to know beforehand the terms of a 0 APR card particularly when and how the APR increases. APR on credit cards usually increases when you missed payments. Missing payments mean the 0 APR benefit of the credit card is forfeited.

You have to move to another 0 APR card once the card that you currently use expires on its 0 APR benefit. Moving from one credit card to another within a span of shorter periods might not look good on your credit history. However, using the 0 APR card option is the only way to make your debt reduction program sustainable.

Consumers are warned not to focus too much on the 0 APR benefit of credit cards. They are advised to be vigilant of the hidden fees charged by credit card vendors which will make the cost of using credit card higher even if it is 0 APR cards. Loan application fees, credit life insurance and annual fees are some of the fees that are not immediately known to consumers. Most consumers do not look at these costs which are crucial in the actual costs of credit card. These fees increase the actual costs of credit card payments.

It is better to shop around for credit card vendors and compare the APR and other cost components in using their credit cards. Having a choice will help you to choose the best credit card there is in the market.


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