Credit cards in general and a 0% APR credit card in particular is a very useful tool that provides a lot of conveniences. Different credit card companies offer various incentives and allurements such as minimum introductory rate, air miles, purchase incentives such as cash back and many other concessions. However, it is necessary that you should be aware of the implications of the various aspects so that you can choose the most appropriate 0% APR credit card. The various terms used in connection with a credit card or the 0% APR credit card and the importance of each term are being described below. Interest Rate And Annual Percentage Rate (APR) The most important aspect of a credit card is the cost of using this facility, which is the interest that you have to pay on the loan and the APR which is expressed as an annual rate denoting cost for sustaining the balance amount on the credit card. It is mandatory for the credit card issuer to inform the borrower about these rates so that he can take the correct decision before using the card. In this regard offers such as 0% APR credit card make more sense. However, to avoid hidden rates and charges, information regarding the frequency of the change of interest rate and the restraints on the amount of variation should also be given.
Grace Period Some 0% APR credit card companies offer a grace period after the end of each billing period to give more time to the clients to be able to pay the credit card balance. This grace period should be intimated to the credit card user and the bill should be mailed to you at least 14 days before the due date.
Various Fees And Other Charges Before choosing a credit card or a 0% APR credit card, it is essential that you know the various fees and charges that might be applicable for using the credit card. This is more so in the case of 0% APR credit card because the card issuing company could levy some hidden or overt charges to set off the loss they suffer by making a 0% APR offer. Credit card companies charge different types of fees such as annual membership fees, cash advance fees, over-the-limit fees and late payment fees. The total effect of these fees can amount to a lot of money that might prove to be quite a drain on the finances of the borrower and offset the benefit you seem to derive from 0% APR credit card.
Finance Charges It’s important to know the system that the credit card company uses in order to compute the balance of the credit card account for calculating the finance charge. It could either be the average daily balance or the adjusted balance.
Other Considerations If you are confident of being able to make the full monthly payments then you should give more importance to the transaction fees, the annual fee and the grace period than the APR. You should also take into consideration the incentives such as the air miles, cash back on purchases and the acceptability of the credit card or the 0% APR credit card in other countries.
A credit card is a very important financial tool that should be chosen with great care and precaution. You should study the various terms and conditions of the 0% APR credit card carefully and exercise caution regarding fraudulent charges being imposed on you by keeping track of the various charge slips. Lastly, you should select the 0% APR credit card that would meet your requirements and suit you the best.