credit cards
Transfers lower credit card interest rate
A credit card interest rate should be a key consideration when deciding whether to transfer balances from a card with a higher rate -- but it's not the only factor to keep in mind.
As more consumers aim to pay off credit card debt, those balance transfer offers that pop up in the mailbox can be an appealing option. Many offer to transfer balances at an introductory APR of zero percent, which can be a great deal at a time when the average variable credit card interest rate is above 14 percent.
But don't forget to take the time to read all the fine print.
Balance transfer fee
Perhaps most important: Find out the balance transfer fee. These days it's not uncommon to see transfer fees of 4 percent or 5 percent. So if you're transferring $10,000 but have to pay a 5 percent fee, that's $500 in balance transfer fees alone.To find out exactly how much you'll end up saving -- or paying -- check out Bankrate's credit card balance transfer calculator. Some cards still have a cap on the balance transfer fee they charge. Or, you may be able to negotiate a lower rate.
Introductory rate
Remember, this is only an introductory rate, so check to see how long the zero percent APR credit card interest rate lasts. After that time period, a more typical rate will kick in.Don't forget to check the APR on new purchases. Those might be charged a standard interest rate.
And if your credit score is shaky, the zero percent APR trumpeted in bold print might not be the actual credit card interest rate you receive, so make sure to read all the details.
Don't be late
If you transfer your balances, make sure to pay each credit card bill on time. Otherwise, you can get stung as the interest rate soars and you wind up paying a much higher credit card interest rate than the one that drew you to make the switch in the first place.
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