Bad Credit Debt Consolidation: The Balance Transfer Method
Posted on Oct 30 2006 | Tagged as: Bad Credit Debt Consolidation
Can you still get a credit card? If so, Transferring your debt from credit cards with a high interest rate to a new card with a lower rate can be a good method of debt consolidation. This could also help both protect your credit score and get you out of debt. However, you have to watch out for extra costs hidden in the fine print.
Look for a new card with a low APR (annual percentage rate). If you can qualify for it and transfer your balance to the new card at no cost, it can save you money in several ways. First of all, you’ll save on interest charges. And secondly, you won’t have to pay a debt consolidation counselor. It might also give you time to pay your debt off or apply for another card to continue the balance transfer process.
There are many websites on the Internet offering debt consolidation counseling and help. And there are also sites comparing various companies that offer new credit cards with the pros and cons of each. For a good balance transfer card, watch out for the following things:
* How long would you have at a low or 0% APR? You’ll need enough time to pay off some of your debt or get another card to transfer onto.
Some cards offer the low APR trial-promotion rate for as long as one whole year.
* What kind of fees (if any) are charged for transferring balance onto the new card? It would naturally be preferable to get a card with no transfer costs.
*Are there any other “fine print” hidden charges? There are numerous “creative” ways credit card companies can charge fees. Be on the look out for issue, balance transfer and closing fees. But, don’t stop there – keep on carefully checking out the fine print.
The credit card companies are in competition for your business, so they keep offering new good deals. However, if they can trick you into paying hidden costs, they definitely will. Review the online websites that compare the differences and read the fine print. It’s up to you to find the best possible deal for you.