Playing the Low Interest Credit Card Game

Did You Know?

Did you know that, as a credit card holder, your low interest credit card might be affected by your payment history with other creditors -- including your utility companies? It’s important to read the fine print when it comes to your low interest credit card agreement. Not only can your rates change due to your interactions with other creditors, but they can also change for no reason at all. The promises of a low interest credit card typically only last for the introductory period. In addition, the period of time may be shortened if do not make your minimum payments on time.

Let's Make It Even More Confusing

As if changing interest rates weren't bad enough, low interest credit card companies will sometimes charge different rates depending upon the type of transaction you are making. For example, balance transfers may be charged at 1.9% for the introductory period while any purchases will be charged at 18%. Therefore, the consumer must be careful about the types of purchases made on that card. Just because your getting a phenomenally low rate on balance transfers, don't assume that rate applies to purchases.

Retailers Do It To

Individual retailers will also promise low or no interest for a period of time. The savvy consumer could take advantage of these situations providing that the fine print is understood at time of purchase. Furniture stores typically run these types of promotions. The promotions usually involve opening store credit card and paying no interest for six, twelve, or twenty-four months. However, the catch usually is paying retroactive interest if the entire balance is not paid off in full. So, a department store credit card can functionally be a low interest for a period of time but only if you pay your balance in full before the promotion period ends.

Knowledge Is Half The Battle

Getting a low interest credit card will save you money if you understand the deal being offered to you. Obviously, credit card companies are in the business of making money from interest. However, as long as you read the fine print on your low interest credit card and adjust your purchases and payments accordingly you can take advantage of these offers with little resulting financial problems.