| If you have just gotten a new card with a | | | | the total amount. Make sure that you check |
| great rate, you might want to take another | | | | the associated fees for balance transfers |
| look. Although you might have secured 0% for | | | | before proceeding. |
| the next 6 months, there are often a range of | | | | |
| cleverly disguised fees and penalties to take | | | | Paying off the cheapest debts |
| into account. If you are unaware of them then | | | | |
| these fees and penalties can really add up, | | | | Another procedure that can cost you money is |
| and end up making your great deal cost you a | | | | the way that your card issuer pays off the |
| lot of money. Here is some advice about how | | | | balance you have. As you begin to pay off the |
| to identify and avoid these sneaky card | | | | balance, the card issuer can decide whether |
| charges. | | | | to pay off the higher rate part of the |
| | | | balance or the lower rate part. For example, |
| Removal of benefits | | | | if you have made a balance transfer of |
| | | | £1000 to your card at 0%, and then have |
| One of the sneakiest charges is not really a | | | | £500 in new purchases at 17% interest, the |
| charge at all, but rather a removal of the | | | | bank is more than likely to pay off the 0% |
| benefits that you have on your card. If you | | | | amount first so that they can make money in |
| have a low APR or balance transfer rate, then | | | | interest off the other amount. If you are |
| you should not take these for granted. | | | | going to get a new card, check out the way |
| Although you might believe this deal is | | | | that the issuer pays off the balance, because |
| secured for the next 6 months as promised, | | | | if you can find one that pays the expensive |
| this is subject to you meeting strict | | | | part off first then you could save some |
| criteria. If you are even 1 day late with | | | | money. |
| paying your bill, or go over your limit by | | | | |
| the smallest amount, these offers can be | | | | Penalty fees |
| taken away from you and replaced with a much | | | | |
| higher APR. Although this is explained in the | | | | Although your card might have low APR and a |
| small print of the contract, many people | | | | nice credit limit, if you don't stick to |
| overlook this and then feel the sting when | | | | making your payments on time then you could |
| their 0% credit card turns into a 20% one. | | | | end up paying huge amounts in penalty fees. |
| Make sure that you know the conditions for | | | | For example, if you have a balance of £990 |
| keeping your deal, and then stick to them as | | | | on your card with a limit of £1000 and you |
| best you can. | | | | don't pay your bill on time, you could be hit |
| | | | with a £25 charge. This charge will put |
| Balance transfer charges | | | | you over your credit limit, and trigger |
| | | | another £25 charge. Before you know it you |
| Although some cards offer a 0% rate on | | | | could have paid £100 in charges just for |
| balance transfers, that does not stop them | | | | being a day late with payment. Although some |
| charging you a handling fee for the transfer. | | | | credit card charges are disguised well, it is |
| Despite you not having to pay interest on the | | | | important to read the contract thoroughly and |
| transferred balance for a period of time, it | | | | check all the charges before signing |
| will cost you money to transfer the balance. | | | | anything. If you do this then you will avoid |
| If your balance is relatively low then you | | | | most sneaky card charges and be able to take |
| could be forking out a hefty percentage of | | | | advantage of your low rates. |