For anyone who wants to pay an outstanding credit card balance but does not want to keep paying the exorbitant interest rates you may be being charged then a life of balance transfer card could be your solution.
They can easily be confused with 0% balance transfer cards and although they work on a similar principle, there are major differences. This is why it is important to know how to use a life of balance transfer credit card before you sign up!
Understand the principle
The first thing you should understand is how the this type of balance transfer card operates. It basically charges you a much lower rate of interest than you would find on any other standard credit card deals, and allows you to keep that special low rate until you have paid the balance completely.
Why do you benefit from this? Basically you get time. 0% balance transfer credit cards give you a 0% rate but only for a short space of time.
The life of balance transfer card gives you as long as it takes to pay the debt, however there are still things you should do in order to get yourself debt free as soon as you can.
Here are some tips on how to use a life of balance transfer credit card:
Overpay
Do not stick to the minimum payments each month. Even though the interest you are being charged is minimal, it is still adding to your debt and by overpaying, you reduce the total interest you have to pay.
Cut spending
Whenever you try to wipe out credit card debt, you should try not to spend anything at all on the card. Put it away somewhere safe or if you can manage it cut the card up and remove any temptation there may have been to spend.
Do not withdraw money
Spending on a credit card is an additional cost, as is using your credit card for withdrawing cash at an ATM or grocery store. The interest you pay on cash advances is normally much higher than purchase interest and is no way worth the cost involved.
You are much better using your credit card to withdraw cash if you really need to.
Transfer straight away
As soon as your application for a card is accepted make that transfer straight away. In fact, this is one of our best tips for how to use a life of balance transfer credit card.
The sooner you make the transfer, the quicker you will benefit from the low interest rate and the quicker you can begin shaving the debt and regaining financial control.
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Posted on Saturday, January 8th, 2011 at 3:11 pm
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