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Credit Card Deals – Avoid Balance Transfers Traps

2007-09-06

Credit card companies rack their brains in order to appeal more and more clients. When selecting a plastic, we take into consideration details that strike our eyes, and miss some significant points. For example, balance transfers seem to be very beneficial and helpful in our struggles with debts. But not everyone sees the reverse side of the medal. Most consumers share the opinion that balance transfers credit cards will certainly save them from debts. The problem is that we overestimate these offers. This way one can easily fall into a trap. Shifting your balances from one card to another, you can make the situation even worse. What should you know about balance transfer pitfalls to protect you from never-ending debts?Actually, balance transfers are not so bad and tricky as you may think. I would say they are fair if wisely used. The thing is we like to be fooled with screaming ads and tempting 0% rates. That is all good in theory, but somehow doesn't work in practice. Why? What do we miss? When do we start making mistakes?

All the stories about balance transfer pitfalls are similar. You may have heard them from your relatives, friends, or colleagues. Students or grades suffer more often than others. It's rather troublesome to pay off when you don't have primary job. Starting out their credit life like responsible cardholders, they find themselves in awkward situation. Temptation is huge!

This is a period which I call trial and error. You think, "None of this concerns me! It's out of the question!" The most interesting thing in all these situations is that people keep on believing the situation is under control. I heard a story about a girl who applied for a balance transfer plastic just because she wanted to have an empty card. She stopped using her first credit card, and... that was the time when problems began. Balance transfer plastics are good when you want to pay your debts off, but not for purchases.

Settle Balance Transfer Problems - 7 How to Tips

1. Credit is good, debt is troublesome. If you want to put an end to your debts, act without hesitation. Delay may cost you a pretty penny. It would be nice to find extra work, and spend this salary to pay off debts.

2. Don't use your balance transfer card for purchasing! Credit companies dream of you making this mistake. You may regard it as a trick. In fact they are authorized to do it. You apply for a balance transfer, and have lower interest rates for your debt repayments only.

3. Read the fine print attentively. The point is that very often we ignore it and have to pay for our mistakes. If you doubt and have questions, phone the company and clear the details up.

4. Take into consideration a universal default clause. It means that the credit card company can raise your interest rates if you make late payments to any creditor. If you find it fair, you may accept this item.

5. By all means introductory period is great! Pay attention to its length. Sometimes 6 months are not enough to cancel your debt. You'd better find a credit card offer with the longest intro period. For example, credit cards with 12 and even 18 months Introductory.

6. If you have no opportunity to pay your debt off, contact your bank and try to explain the situation. Together you may work out the solution that would be acceptable for both parties.

7. Don't be afraid to take steps in order to solve your problems. Some individuals prefer not to pick up the phone for example. Mind that a credit company is interested to get money. Anything is better than nothing.

Scarlette, 08:56 AM, September 10, 2007

Thank you for the useful article. Balance transfer is a complecated thing for me, you helped me to understand it better.