The following is a guest post.
You may be one of the many people who are doing everything they can at the moment to get control of their outgoings and more efficiently clear their debts. If this is the case, you may want to think about some of the benefits a balance transfer credit card can offer.
But what exactly do these cards do and how might they help you? Well, you’ll find many providers now offer them and can tell you, but here is a quick guide that might give you an idea.
What is a balance transfer?
If you have debts that have high rates of interest, perhaps on store cards or existing credit cards, it can often feel like you are getting nowhere in paying them off. When you set up a balance transfer, you’ll be collating all of these debts and moving them to a place where the interest repayments are lower. This means that not only do you end up paying less back, but you also get the added convenience of having just the one monthly payment to make. With some credit cards, you’ll get a 0 per cent balance transfer rate for an introductory period, which could allow you to get things paid off even quicker and at less cost.
Are there any fees to look out for?
If you look at the range of credit cards out there with a provider like MBNA, you’ll see that there are certain differences that you’ll need to be aware of. The first of these would most obviously be the APR and any introductory periods that come with the card, but it could also apply to things like annual fees, balance transfer fees and any charges for handling. You may want to offset the cost of these fees against any rewards schemes that come with the card to see if it is all worthwhile, but as long as you are aware from the outset of what they are, you’ll be in a good position to make a decision.
You’ll find that arranging a balance transfer can be pretty straightforward. For many years, switching credit cards seemed like something of an administrative nightmare – with multiple phone calls and reams of paperwork as part of the deal. However, the internet has pretty much put an end to all of that, with most providers now able to get you set up quickly and efficiently.
With all this in mind, it may certainly be worth seeing if there is a card of this type that might end up saving you money in the long term.
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