Credit cards Updated:
At this time of year the money savvy amongst us will usually be running the rule over new ISA accounts, but the 0% balance transfer market is worth more than a moment of your time.
That's because providers are falling over themselves to increase the length of time customers can pay off their balances while incurring no interest.
Until recently, the longest 0% period available to credit card holders was 16 months.
But a raft of activity has seen the maximum balance transfer period creep towards the two year mark.
Barclaycard has led the charge in recent months, setting the trend for more generous terms at 0%. The latest review of its Barclaycard Platinum Visa card offers a rate of 0% on introductory balance transfers for an all time high of 20 months.
As of 21/03/11 Barclaycard are also offering new customers 25% off any additional balance transfer fee when you transfer more than one balance to Barclaycard (terms and conditions apply)
Coming in just behind is Virgin Money's Credit Card MasterCard, which has benefitted from its 0% balance transfer period being extended from 16 months to 18 months. Virgin Money has long been a heavyweight in the 0% balance transfer arena and this card really packs a punch, also offering 3 months interest free on purchases.
Meanwhile, Nationwide's Balance Transfer Visa Credit Card offers a highly competitive term of 17 months, while the NatWest Platinum 0% Mastercard offers 16 months and the Halifax Plus 0% Mastercard 15 months.
The 0% balance transfer credit card works by offering a period in which no interest is charged on the balance carried over from another card, giving holders breathing space to clear their debt. For example, if a person had racked up debts of £7,000 on their credit or store cards, they would be able to clear it by paying £437.50 a month for 16 months, or £350 over 20 months. As there is no interest to pay, card holders could potentially save hundreds of pounds.
An effective way of making sure you pay off your balance is by setting up a direct debit for the amount you need to pay each month that comes out of your bank at a time you know the funds will be available, perhaps just after pay day.
It is important that you make payments on time each month, as failure to do so will probably result in the valuable 0% element of the card being withdrawn, leaving you back where you started.
Compare 0% balance transfer credit cards
Compare 0% platinum balance transfer credit cards
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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