0 Balance Transfers

When it comes to credit card debt, 0 balance transfer deals can deliver significant savings on interest. A good credit score (690 or higher) is required to qualify for 0 balance transfer cards. The higher your FICO score, the better the deal you can expect.

To save the most, apply for the card with the lowest balance transfer fee and the longest 0 percent APR your credit score will get you. Pay the transferred balances in full during the 0% period. If that’s unmanageable, you can still save on interest while the zero percent offer is in effect; you just won’t save as much.

A 0 interest balance transfer does not mean 0 interest; it means reduced interest. Because a balance transfer fee of from 3-5% will be charged on every transferred balance, it’s wise to do some math before applying for 0% balance transfer cards.

Make sure the 0 balance transfer fees amount to less than what you’re already paying in interest. If the difference is minimal, consider whether the savings are worth the cost of getting a new card. Every time you apply for or obtain a credit card, your FICO score goes down. Less than spectacular savings on interest and a lowered credit rating may not be worth the hassle of getting the card.

After the promotional period expires, you’ll pay the card’s regular annual percentage rate (APR) on new purchases and any transferred balances that remain unpaid. Lenders are currently offering zero balance transfer cards with variable APRs; there’s no way to know in advance which APR you’ll actually pay. You might be charged an APR that’s just as steep as what you paid previously on transferred balances.

The best deal on zero APR balance transfer cards in 2010 is the Capitol One Platinum Prestige Card. It offers a full twelve-month 0% APR on balance transfers and purchases. There’s a 3% balance transfer fee and a variable regular APR of 11.9%. There’s no annual fee and you’ll need excellent credit (750 or above) to qualify.

Citi is currently offering the Platinum Select MasterCard and Citi Diamond Preferred Card. Both come with a 3% balance transfer fee, a $30 purchase credit, and a 0% APR of up to 18 months. According to the terms & conditions of the cards, the 0 interest balance transfer period could be as short as seven months and the regular APR could be anything from 11.99% to 19.99%. You won’t know what’s what until after you’re approved and a new card is on its way. On the upside, the required credit score (690 or above) is more lenient than that of most 0 balance transfer cards.

Here’s another thing to consider with these credit cards. 0 balance transfer offers all come with the provision that minimum payment amounts will be applied to 0% balances first. To maximize savings with any 0 APR card, refrain from making purchases subject to the regular APR until transferred balances and 0% purchases are paid in full.