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Make the most of record balance transfer deals

Make the most of record balance transfer deals

Category: Credit cards

Updated: 14/02/2014
First Published: 11/02/2014

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Competition in the balance transfer market is definitely heating up, with lenders tempting you to transfer your debt to them so you can benefit from record interest-free periods. It's a great opportunity to take control of your financial situation and reduce your overall level of debt without interest racking up, and with so many offers available it's a great time to make the most of them.

Get access to the longest balance transfer cards

Happily for credit card users, the length of balance transfer deals is on the up. Deals can range from a few months to a whopping 31, with Barclaycard easily topping the charts by offering several different options – including its Barclaycard Platinum 31 Month Balance Transfer Visa, launched this week, which offers the longest balance transfer period that's ever been seen.

Clear your debt quickly and simply

For most people, this should be plenty of time to pay off their credit card debt. It's simple to work out how long it'll take, and as long as you pay more than the minimum amount each month there's nothing to stop you from being debt-free by the time the 0% interest period has come to an end.

All you have to do is divide the total balance on your card by the number of months in your interest-free period and voila, that's how much you need to repay each month in order to clear the balance in full – before additional interest starts being added. It could be the ideal solution for those who are still feeling the effects of Christmas overspending, and if you've yet to find a suitable deal it's time to get searching.

Make your card work for you

Of course, there's more to think about than the 0% deal. Here are a few additional things you'll need to bear in mind to make your card work for you:

  • If you can afford to pay off your balance sooner, don't always go for the longest deal available as these will usually have higher fees than cards which offer shorter interest-free periods.
  • Having said that, make absolutely sure that you'll be able to pay off the full balance by the time the interest-free period ends – fail to do so and you'll end up paying hefty interest rates.
  • At the very least, make sure you pay the minimum amount each month. If you don't, your interest-free offer could be withdrawn and you'll be stuck paying higher rates.
  • Don't spend on your card, as the interest rate for purchases will often be fairly pricey and will mean you lose the intended benefits. If you're looking for cheap borrowing for additional purchases, consider cards which offer 0% purchase deals instead.
  • Bear in mind that the headline offer may not be the one you get, as interest rates and balance transfer deals (and overall acceptance) will vary depending on your individual circumstances and credit rating.

What Next?

Compare balance transfer credit cards to find the best deal

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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