Understand how and why balance transfer credit cards UK and US differ from Australian balance transfer cards. Check out the market to find the best balance transfer credit card.
Comparing balance transfer credit cards UK or US with Australian balance transfer credit cards is likely to make you a little peeved. One marked difference that you cannot fail to notice is that their offer periods are longer than Aussie ones. Currently in the UK, the Virgin Credit Card is offering 0% interest on balance transfers for 16 months. That’s sixteen months. Plus, there’s no annual fee and you also get 0% on your purchases for the first three months. In fact, annual fees are not charged on UK or US credit cards as a general rule, although there has been talk that this may change.
Before you get too jealous, you must remember that the UK and US have probably been the hardest hit of all countries by the economic crisis, therefore their people need the most help. And to take advantage of the UK Virgin Credit Card offer you would have to move to the UK, thus you would never see sunshine again.
There is also a significant downside with balance transfer credit cards UK or US in that they charge balance transfer fees. The Virgin Credit Card charges 2.98% (3% in the real world), thus if you have a large balance to transfer then you are paying upfront for the privilege – £300 for a £10,000 balance transfer.
Apart from one or two cards, Australian balance transfer credit cards do not charge balance transfer fees, and it is possible if you scour the market to find a card that offers a balance transfer with no annual fee. Of course, you would have to do a few sums to make sure you are getting the best deal because Australian no annual fee credit cards may not have the very best balance transfer offers attached to them.
Another problem with balance transfer credit cards UK
There is also the issue of how longer balance transfer periods can breed a more relaxed attitude towards debt, which is never a good thing. Plus, the three months at 0% on purchases might encourage you to spend on your card, which means a part of those purchases may not have been paid off by the end of the three months and they would then revert to the normal interest rate of 16.6%. But as your cheaper debts are always paid off first, that amount at 16.6% would then sit accruing interest for the remaining 13 months or until your transfer was completely paid off, whichever came first.
So, perhaps balance transfer credit cards UK or US may look more attractive on paper, but Australia is a very different country and the same rules cannot apply. For one thing, there are 60 million people squished onto the UK – three time more than in Aus – and most have credit cards, therefore credit card companies can make better offers because they are dealing with profits from three times as many people.
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Posted on Monday, March 29th, 2010 at 11:21 am
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