Many financial websites and agencies often will survey credit cards every week or throughout the month periodically, but with such a wide variety of credit cards now available, many consumers have had to take a step back to look at what needs they may have in terms of a new consumer credit card as there are countless rates available for anyone looking for a card. Yet, one of the more popular credit card options that some consumers have found helpful here in May is a balance transfer credit card as these types of credit cards offer debt consolidation opportunities, usually with a low interest rate for an introductory period, and may have some consumers of the mind that they can pay off multiple debt obligations on this one particular card.
While this has been accomplished by some in the past weeks and months, balance transfer credit cards are not always in the best interest of each consumer, so comparing not only the rates that these cards will offer, but other aspects of a balance transfer credit card must be carefully attended to by each potential cardholder before making a decision on what lender of a card they want to work with or if the balance transfer card is right for them at all. When it comes to interest rates, though, balance transfer credit cards are averaging rates of anywhere between 12% and 16% today, but keep in mind these rates could be much higher depending on a cardholder’s financial position or much lower if certain elements are in place.
As an example, one of the main attractions to these balance transfer cards, aside from the opportunity to consolidate debt, comes in the form of long stretches of 0% interest that may be offered as part of the introductory deal. The CARD Act has stopped practices where credit card companies can suddenly increase an interest rate without giving a consumer 45 days notice, but the introductory rates are only for a set time and consumers must keep in mind that the rate they receive on a balance transfer card can increase without warning once the introductory period has expired, if consumers missed payments, or if certain conditions are not met. There are some cardholders who must make a minimum amount of purchases before their low interest rate will remain in place, but this does not apply to all balance transfer cards and is one of the reasons consumers must compare these options if they are in the market for a balance transfer card.
Once more, balance transfer cards that offer debt consolidation opportunities are best used by consumers in a good financial position who can pay off this consolidated balance in a timely manner while their interest rate remains low, but also, consumers must keep their spending under control so that they don’t begin using other cards which were charged off with this balance transfer card, as some have made the mistake of consolidating debt on their balance transfer card and then acquiring more debt on other unsecured lines of credit, which can be problematic in the future for a cardholder’s financial life.