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Credit Cards And Loans - So Many Options - So Little Time
Credit Cards and Loans sounds like just two things, but in actuality, it is dozens of things. Due to a combination of user preferences, lifestyles, and marketing ideas, there are dozens of different types of credit cards out there. Because of the wide ...
Unsecured Credit Cards
The unsecured credit card is the most popular type of credit card for general public use. Though both secured and unsecured are accepted virtually everywhere, the unsecured credit card is both more convenient and usually less costly to obtain for the ...
What Are Interest Free Credit Cards
Credit cards that charge no interest on your purchases or on your balance transfer for a certain period of time are said to be interest free credit cards. This interest free period is for a certain time and limit. This gives you the chance for more ...
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It is interesting to note that what started off as a marketing gimmick has now become an almost permanent part of the credit card industry in America and today 0% APR credit cards can in fact play a significant role in helping a person reduce or get out of debt.
What Is A 0% APR Credit Card?
APR is the annual interest rate known in industry jargon as the Annual Percentage Rate. It is a reflection of the cost of credit. In the old days everybody paid a standard APR based on bank rates. It was usually about 18 per cent. The use of low APR came with the emergence of the monoline bank. These were banks that only issued credit cards and did not take any deposits or issue conventional loans. For their business model to work well large numbers were important for these breed of pioneering bankers and credit cards issuers so low APR teaser rates were successfully used to lure as many new card users as possible.
The gimmick seemed to have worked so well that today it is difficult to find a credit card company that does not offer some type of incentive APR during the first 6 months or one year. The more popular credit cards offer 0% APR for the first year.
Usefulness Of A 0% APR Credit Card In Reducing Debt
A 0% APR credit card can be extremely useful for somebody who wants to reduce their large credit card debt. For instance if you have a credit card debt that remains at about $10,000 and the APR is 20% then you will end up paying a whooping $2,000 in interest payments alone. With a 0% APR credit card the $2,000 could all go towards reducing that crippling debt. It is therefore clear that 0% APR credit cards can offer much needed financial breathing room for somebody in a serious credit card debt situation.
Consolidation Or Transfer Necessary To Benefit From 0% APR Credit Cards
Transferring a credit card debt or credit card debt consolidation are all-important first steps that will need to be taken before a person in deep credit card debt can enjoy the benefits of a 0% APR credit card. The objective here would be to have all the person's outstanding debt payable to one credit card company and at a 0% APR rate.
The importance of 0% APR credit cards in helping an individual or business to get out of credit card debt cannot be understated.
Although many potential card users place a lot of importance in being able to obtain a 0% APR credit card, the truth of the matter is that it is only attractive and beneficial to two groups of people. Firstly persons able to settle their credit card balances on a month to month basis to whom the 0% APR rate means that their cost of maintaining a credit card is very minimal. Secondly those in debt also benefit because the 0% APR credit card greatly assists them in their efforts to reduce their debt.
Copyright 2005 Ed Vegliante.
About the Author
Ed Vegliante is the owner of http://www.credit-card-surplus.com , a well organized credit card directory enabling the user to compare and apply for a variety of credit credit card offers. Find links to secure online credit card applications.
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Credit card defaults go to courtMcMinnville News-RegisterBut if it's a card from Capital One - or Discover, Citibank or virtually any other purveyor of consumer credit - you don't want to get behind on your bill. If you do, that card can double as an invitation to a circuit court lawsuit seeking damages. |
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