Which Balance Transfer Credit Card is Right for Me?
The whole point of going through the process of getting a balance transfer credit card is to save you money, so it stands to reason how worthwhile it is to make sure you're taking out the best balance transfer deal for you and your finances.
Virgin Holds Out for No. 1 Balance Transfer Best Buy
The Virgin credit card topped the balance transfer best buy tables in 2007 and it’s set to do the same in 2008 too. With a 0% balance transfer deal for 15-months, Virgin credit card remains the unrivalled choice for managing your money.
0% balance transfers vs. life of balance transfers
If you have outstanding credit card balances, balance transfer credit cards can be a great money-saving tool to help you clear up your existing card debts and get back in control of your finances.
How Life of Balance Transfer Credit Cards Work
Promotional interest rates offered on balances moved over from other credit card accounts that will last until the balance moved is repaid in full - however long that takes.
A. You should avoid spending on a card that you are using for a life of balance transfer, otherwise you could end up paying a lot of interest on your debts, even with the low interest rate that is being offered on your transferred balance.
Credit card providers will often apply payments towards lower or promotional rate balance first, leaving any non-promotional transactions, such as purchases or cash withdrawals to accrue interest until the cheaper balance transfer is repaid first.
You should try and use your life of balance transfer credit card only as a tool for repaying your current outstanding card debt.
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A. The minimum monthly repayment on a life of balance transfer credit card would be based upon the balance outstanding on the account and the actual minimum repayment rate as laid down in the terms and conditions of the card.
Minimum repayment rates are charged as a percentage of the balance owed, and this can be 2%, 2.5% or 3% depending upon the card.
This equates to around £150 repayment on a balance owed of £5,000 – based on the higher 3% minimum repayment rate.
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A. Life of balance transfer credit cards offer a low rate on the balance moved over from your current credit card until it is repaid in full. So the ‘life’ period refers to the life of the balance.
While life of balance transfer offers do not give a 0% rate, they do offer the benefit of removing any ending promotional period to worry about, giving you the peace of mind of a low interest rate until you are able to clear your outstanding debt in full... Read the full answer »
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