Choosing The Best Credit Card

Credit card lenders are starting to respond to the increasing demand for permanent low interest rate credit cards. Everyone it seemed was looking around for the best 0% balance transfer offers, but consumers are finding out that it may not be the best credit card for them. More often than not consumers end up paying over the odds interest rates because they have not paid the balance in full before the transfer offer has expired. 40% of consumers don’t pay off their transfer balance within the time limit with half claiming the time offered to pay off the balance was too short and 13% of consumers saying that they forgot when the time limit ran out. So what are the benefits of permanent low interest rate credit cards and 0% balance transfer credit cards?

With flat rate credit cards you know exactly how much interest you are paying every month without any hidden extra costs or surprising interest charges that you may have forgotten about. If you can’t make a payment in full then you know that the interest charged will be low. Be wary of which low interest credit card you choose because not all of them offer an interest free period. You would start being charged interest straight away if you opted for the Halifax Flat Rate Online card or the Bank of Scotland Little Black Card. Other major cards offer you from 46 days up to 59 days interest free.

The flat rate deals that are on offer at the moment all differ slightly with some of them charging a higher rate if you are deemed a high risk customer. Not all low interest credit cards charge a higher interest to high risk customers such as the Co-Op Bank Clear card or the Yorkshire Building Society Base Rate Tracker card whose interest rates are 8.9% and 10.5%. These interest rates are slightly higher than a credit card that would charge more for a high risk customer. The Barclaycard Simplicity card starts at 6.9% but you may be charged more if you are a high risk customer.

0% balance transfer offers may be more attractive if you want to keep your payments low for the immediate future but not as a long term solution. Knowing exactly when your interest free period has expired and paying off your balance before then can save you money. You can be charged a high interest rate, as much as 28.8% a year, on your balance once your interest free period is over costing you dearly and defeating the purpose of transferring to a 0% balance deal, so be vigilant.

There isn’t a right and wrong answer to which is the best credit card. The right answer is which one suits you more and which one will save you the most money long term. Both low interest rate credit cards and 0% balance transfer credit cards have equal benefits and disadvantages.