Interest free credit cards are very tempting when you’re in debt. You might think you can get away with paying no interest on your credit card balance. But the truth is, you may find yourself much deeper in debt before you realize it. Interest keeps adding up and the amount you have to pay at the end of the month adds up each month. If you use an interest free credit card, you can pay off your debt without adding anymore interest to your financial situation.
The most obvious advantage to interest free credit cards is their benefit to people who cannot handle credit very well. Many people have bad credit and do not qualify for traditional credit cards. They might even qualify for a low interest credit card but just cannot qualify because of the credit problems. If this describes you, then an interest free credit card is for you.
But interest free credit cards come with a lot of disadvantages. First, you must be sure to make all of your payments on time. Most interest free credit cards require you to pay minimum monthly payments. This means that you will be paying interest every month on the money you never get to use! If you have a good credit history, then an interest free credit card can save you a lot of money. However, if your history is not so good, you could end up overspending and in debt again.
An interest free credit card can be a trap as well. Many companies will offer a low introductory rate on their credit card. However, after the interest free period, the normal interest rate will kick in. By then, you could have already spent most of the interest free period on other things, leaving you with a high interest rate card.
You should be careful with an interest free credit card. Don’t just give them away to anyone who asks for one. Read all the fine print carefully. If you find out that you cannot afford to pay back your credit card, you may be in deep trouble. If you don’t pay it off, the company can increase your interest rate and you will be stuck paying back hundreds of dollars in interest.
Before you apply for an interest free credit card, be sure to research the company. Check with the Better Business Bureau to see if there are any complaints against the company. You could contact the Federal Trade Commission and ask them for information. The Internet is also a great source of information. All three of these resources are very useful to help you find the best interest free credit card.
When you do find an interest free credit card, make sure you use it responsibly. This type of card allows you to use your regular credit cards at any online site where they accept major credit cards. Make sure you read your monthly statement carefully and make sure you make payments on time. If you don’t, the company will increase your interest rate and your card can go into default.
An interest free credit card is a great way to consolidate your debt and manage your finances better. However, you need to remember that you still owe the debt so don’t just go out and spend without thinking. Use your interest free credit card responsibly and you will find that you are happier in the long run. It’s not hard to get an interest free credit card, but it is very important that you use it wisely.