When using a credit card with zero interest, you may be tempted to delay
paying it off; however, that’s not necessarily a good idea. Here
are some reasons why you should not wait to pay off zero percent credit
cards until the end of your trial period draws near.
"Interest Free" Is Not Forever
Interest free credit cards usually offer zero interest for a certain period
of time, which can range from as little as six months to as many as twenty-four.
After that time, the
interest increases significantly, and can sometimes be as much as 26.99 percent. As such, interest-free
credit cards can be an excellent way to eliminate other debt, provided
you pay them off before the trial period ends.
Extend their terms, and you really won’t be much better off, especially
when you consider that these cards may also compound interest monthly
during the trial period. This interest would essentially be added onto
your balance at the end of that timeframe.
Zero interest cards may also allow you to
transfer your balances from another card, but might charge you a “fee” amounting
to around three percent of the balance for doing so. This amount will
also be added to your total balance.
Unplanned / Unnecessary Purchases
Having an interest free credit card could also make it tempting for you
to make purchases you otherwise would not have considered. In that instance,
having a zero interest card would actually cause you to go deeper into
debt rather than helping you get out of it.
Speak with a Debt Relief Attorney in Torrance
If you do take out an interest-free credit card, read the terms carefully
to ensure you know what you are getting into. After that, make a diligent
effort to pay your card off as quickly as possible, and avoid making additional
purchases. If you still find your debt is overwhelming,
contact us to determine if
bankruptcy might be a solution.