Zero APR: Good while it lasts

2007-03-08 10:33:40

( Financial )



SAVE MONEY BY PAYING EARLY

Zero percent apr or annual percentage rate is a temporary credit card arrangement that does not charge you with interest and finance fees on purchases made on the card.

Zero apr is usually offered to first time credit card applicants or to those who are planning to transfer their balance from one credit card to another. In simple terms, zero apr is a marketing tool designed by banks and credit card companies to encourage clients to choose them over their competitors.

Indeed, zero apr is attractive and if used properly, can save you a lot of money. You can take advantage of this credit card plan by transferring the balance of your existing credit card to one that has a zero apr.

BEFORE THE DEADLINE

Once the transfer is done, the zero apr rates will substantially cut down on your monthly bills, making it easier for you to finally close your credit card debts. Just make sure to settle your debt within the zero percent apr period. If you fail to do so, you will have to pay interest and finance charges just like a normal credit card.

The first thing you need to do before applying for a zero apr card is to determine how long the zero apr will last. There is no standard time, as the zero apr period varies greatly from bank to bank. Some will offer it for just a few months, while some will give you zero apr for a year or more.

After determining the time period, make sure to find out how much rates will be charged to you once the zero apr period is over. This is equally important because if you can only afford to pay the minimum payment requirement month after month, the interest and finance charges will pile up, leaving you in much deeper debt.


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