Credit Cards with 0% APR on Purchases–Who wouldn’t want a credit card with 0% introductory APR on purchases? Cardholders make purchases and are not responsible for paying any interest on the purchases until the introductory period ends. This seems like a good way to get things now and pay for them later. It is just like using cash but better. It is important to know exactly how no interest credit cards work, and the ways they can benefit the cardholders.
How 0% (Zero Percent) Introductory APR Credit Card Offers Work
0% introductory credit cards work in a simple manner. Customers apply for a credit card of their choice that offers no interest during the introductory period. Customers have the greatest chance of getting approved if their credit is good. Customers can apply for the credit card in stores or online. Approval is usually determined within a few minutes, and customers can begin using the credit card immediately.
For example, if the customers gets a 0% introductory rate on a credit card for 1 year, the cardholders only have to pay the principle on the charges until the introductory period ends. If the balance is not paid at the end of the year, interest is charged on the remaining balance.
The interest varies from credit card to credit card. It is important that the cardholder knows what the interest rate will be after the introductory rate ends. It is vital that cardholders pay off the balance of the credit card before interest rates begin. Interest rates after the introductory period are usually in the 20% to 30% range. A high interest rate can create unexpected debt if the credit card is not paid in full before the introductory period ends.
Tips for Being Approved for 0% Introductory Offers
Receiving the zero percent introductory APR credit card offer is not guaranteed to all customers. There are a few factors that customers must consider, including:
· Credit Score
The credit score of customers is one of the most important factors in determining approval. Creditors want to know that potential cardholders will pay back the debt that they create. Customers should know what their credit score is before applying for a credit card. Do not apply for too many credit cards in a short amount of time because this can lower the credit score. Credit card companies check credit, and inquiries are placed on the credit report. Inquiries lower credit score, and too many inquires may be intimidating to potential creditors.
· Pay off Debts
Having too much revolving debt on other credit cards may reduce customers’ chances of being approved. Creditors may not extend credit if they see that potential cardholders have low available credit on credit cards. Getting out of debt increases the chances of being approved.
· Pay on Time
Late payments may decrease the chances of receiving approval on a no interest credit card. Late payments can also lower the credit score and prevent customers from being approved.
· Apply for 0% Introductory APR Cards Online
Increasingly more credit card companies are offering the option to apply for no interest credit cards online. This is a great thing for potential cardholders because they no longer have to wait weeks to determine if they are approved. It also is easy to compare the credit cards to determine which offer is the most suitable for each person.
Important Things to Know About 0% APR Offers
There are a few things that customers need to be aware of when applying for no interest credit cards. The following are things to consider:
- Cardholders must know when the introductory period ends. No interest rates can last a few months to a few years. It is important to know this before signing up to receive the credit card. A short introductory period can create additional debt that cardholders are not prepared to pay.
- Payments must be made on time. Cardholders must pay their bills on time or the introductory rate ends. For example, a 2 year no interest credit card can turn into a 26% interest rate after the first time the monthly payment is not on time.
- Over-the-limit charges may apply even on no interest credit cards. Cardholders must understand what their credit limit is to prevent additional charges to their account. Cardholders can have fees as high as $35 added on to the credit card balance until the credit card balance is under the credit limit.
0% introductory APR on purchases offers a great opportunity for customers. As long as they use the card responsibly and understand the stipulations of using the credit card, they should receive wonderful benefits with this type of credit card.