Interest Free Credit Cards – Sound Financial Idea, or a Hidden Cost?

Managed correctly, interest free credit cards can offer a great way to borrow money. However if you are not careful, you may get caught out be hidden costs that are sometimes involved with these cards. We investigate to see how you can avoid getting stung.
  

Before applying for any credit card, you should make sure that you have all the facts about the charges involved.
  

Although at first glance it may seem like you can’t loose, interest free credit cards are no exception. Here are four points to help you avoid getting hit hard by unexpected fees.
  

1. Make sure you know the exact length of the interest free period. All too often people over run this period without knowing it, and end up paying interest that they didn’t count on having to pay. Make sure you not only know the length of this free period, but also have it in writing, safely filed away.
2. Know the rate after the Interest free period runs out! – Whilst you may feel this is not applicable, as you are confident that you can clear the balance before the interest free period runs out, none of us really know the future, and so you should at least be aware of the rate that you will be charged after the interest free period.
3. What is covered by the interest free offer? – This seems an obvious question, but in fact, many people are actually caught out by this! – For example, did you know that in some cases buying a gift voucher may not be considered as an interest free period??? – Or gambling online? Imagine the shock when you get your card bill and you have been charged interest on hundreds of pounds worth of gift vouchers you bought people for Christmas? – AVOID these problems by getting your facts straight right from the start!
4. What happens if you fail to meet a month’s repayments? – With some lenders you may loose your remaining interest free period! – Check this before you apply for the card! As you can see, there are numerous ways to get caught out when using interest free credit cards.

 

Make sure you do your research, and educate yourself as to what the deals really mean for you.
  

Websites like www.creditchoices.co.uk offer consumers a comparison service, to make sure you get the right deals for you.

 
  

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