A balance transfer creditcard is a good option for anyone with poor credit. This type credit card allows the transfer of your balance to another account at a low-interest rate during the initial period. After the intro period, any balance that isn't paid in its entirety will attract a higher interest.
Low introductory APR
You can use low APR balance transfer credit card to pay off large debts. These cards often have no annual fee and a low introductory APR on balance transfers. These cards offer rewards programs which can lead to cashback over the term of the account.
To determine if you are eligible for a low APR balance transfer credit card, you can check your credit score. If your credit score is less than 580, you are considered to have "poor credit." Applying for a low APR balance transfer credit card should take into account the promotional period, as well the APR.
No interest-free period
Consider these factors when selecting a balance credit card. Consider whether the card will offer an extended interest-free period. If the card does offer interest-free periods, you may end up paying much more than you originally intended. It is important to pay attention also to the credit limit.
Your credit score is a key factor in whether or not you are qualified for a transfer card. Issuers will prefer applicants who have good credit, as this will translate into longer interest-free periods with lower interest rates. Your credit score will impact the maximum amount that you can transfer to a card. This amount may be a fixed dollar amount or a percentage of your total limit. Each situation is different, but the general rule of thumb is that the lower your credit score the more credit card companies will offer.
Fees
Although balance transfer credit can help you save money, it won't help with your debt. Instead, you should make a conscious effort towards paying off your credit card balances. A lower monthly payment means less interest over time. You can also find credit cards with a zero-percent intro APR offer.
Consumers who are looking to lower their credit card debt and save money love balance transfer credit cards. Many of them offer an introductory interest-free period of six to 18 months. Some cards have longer introductory periods. You should also be aware that there are fees and other conditions. You can be penalized if you violate the terms of the cardholder agreement.
There are limits
Getting a balance transfer credit card for bad credit can help you consolidate your debt, but be careful that the limits aren't too low. A balance greater than $10,000 may prevent you from transferring the entire amount to your new card. It is best to choose a card with a credit line of $12,000 or more. This is because a credit card with a higher limit is more likely to accept the entire balance transfer.
The credit limit on your balance transfer credit card for bad credit will be based on your credit score and other factors, such as your income. You can transfer up 100% of your credit limit to some cards, while others allow you to transfer only seventy-five percent. Be sure to ask for the limits before applying.
Alternatives
Although balance transfer credit cards are useful for those with bad credit, they may not be right for everyone. Although they can reduce your monthly payments, these cards don't offer the best option to pay off your debts or improve your credit score. Instead, consider applying for a secured credit card and paying down your debt to improve your credit score.
An arranged balance transfer credit card can be used as an alternative to a debit card. This is a way to extend your bank account. An arranged-overdraft allows you withdraw money when your account balance falls below certain amounts. The interest rates on this feature are usually very high. However, many banks will allow you the option to open an arranged overdraft interest free.