What are balance transfer credit cards?
As we know, a credit card has many features. As per the feature of the credit card a borrower may transfer his funds from one card to another to make the payment. Hence, this process of transfer is balance transfer. Also, such credit cards are balance transfer credit cards. In balance transfer credit cards, a borrower utilizes the credit limits of all the cards. In fact, he may wisely make the funds transfer from one card to another right before the due date. Overall, this helps the borrower to rotate his funds without paying high fee and charges. So, the virtual credit limit of the credit cards works like the real money. By doing such transfers, again and again, the bank may increase the credit limit of the borrower later. As a result, a borrower feels stress-free after managing his finances.
How do balance transfer credit cards work?
Apparently, a balance transfer is a facility of a credit card given by the bank. Also, it is not evident that you will get balance transfer facility in all the credit cards. In fact, it may be there or it may not be. So, to utilize a balance transfer facility, a borrower should confirm the bank about it. As a result, if the bank approves a balance transfer to the borrower, a customer may use this service. On the contrary, there are charges applied by the bank for taking this service. In fact, the borrower should inquire about all the charges before using this service. Whatever the amount you transfer in another credit card. That will be the due amount for the credit card bill. You may pay it before the due date to avoid late charges.
Lower your debts with balance transfer credit card
There are a lot of people who use several credit cards. When you use a number of these credit or store cards you can end up in a big pile of debt. The interest rates on cards are usually high up to 25-35%. So you can use a balance transfer credit card to cut out on some of the debts. All you have to do is transfer your high interest rate credit card to a cheaper credit card with a low interest deal. By doing this you can easily lower your interest rates, in some cases it can 0 with a 0% transfer card.
However, your card issuer can set a limit on the amount of money which you can transfer. But this doesn’t stop you from moving your debts if you stay in your transfer limit. Mostly the issuer lets you transfer about 95% of the credit limit to your new card.
Know how you can get guaranteed bad credit loans for small expenses.
Why are balance transfer credit cards so popular?
Seems like, every credit card holder uses a credit card because the credit limit helps us to manage finances. In a few cases, the card user extends the limit by using more cards. So, he may manage this by transferring funds from one card to another. Although it charges a fee to transfer the balance yet it is nominal and less than late charges. Therefore, to use the credit card smartly, a balance transfer facility is worthy. Likewise, this transfer can take place from another to some other credit card. Hence, the balance transfer credit cards help the credit card users to manage their funds. Also, if you use this facility properly, you may not need to borrow small loans for your sudden needs.
How much deposit do I need for a mortgage?