Are Low Interest Credit Cards Really a Good Deal?
Sure it may seem like a great thing to find a credit card with low-interest rates but are they really as good as they initially seem to be? Sometimes they are and sometimes they are not. Unfortunately it is not an easy question to answer and the answer can change accordingly. Something that is very important to do is research, research, research! You do not want to rush into things just because the deal looks shiny and great at first glance. A lot of credit card companies use low introductory rates to lure their costumers in. Then when they got you signed in an iron clad contract, the rates suddenly change!
There are hidden fees and the like to consider. Did you make sure to read the fine print? Just because the credit card in question claims to have low rates does not mean you are going to save money in the long run. There is a menagerie of ways that the credit card companies can get over on you and then dig their claws in deep. Some of these traps include hidden fees as we discussed earlier. Another may be high punishment fees for going over your credit limit. All the low credit rates in the world will not matter of you go a few dollars over your limit and find you owe another large amount on top of the debt that you already accumulated. It will not matter that you saved here and there with the low rates then, now will it?
Not to mention that sometimes introductory rates change from time to time. The low credit rates that are promised in the beginning may not be promised for the long haul. Those low rates were only there for the first year, maybe even less on some occasions. It is very important to make sure you learn just how long those low credit rates last in the end. The monthly fees you end up paying after the introductory low rates run out may not be worth the savings you have gotten in the beginning. It is very important to know just how long those low-interest rates last after all.
It is not all bad, however. These days, there are more options out there for people who have bad credit. One of the good options is that there are some credit card companies that offer lower rates to people with bad credit. So it may not be a smart way to get lower rates on your credit card, but if your credit is already bad, it is something to indeed think about. Make sure you do your research and be sure you are not trapped in a noose of changing fees you will not be able to afford down the road. You have to be careful and do not want to end up hanging yourself in the end. Read the fine print and do your research if you want to come out on top.
Some of the credit card types will usually charge higher rates such as rewards credit cards and student credit cards. Make sure you know what you are getting into before you settle on a specific credit card. Some of these types of credit cards will have low introductory rates for a time but once that time is up the prices rise. Sometimes the regular rates are much more expensive than you originally believed you could afford.
Do not be afraid to look on various sites to find out credit cards rates. There are plenty of search engines out there that can tell you just how much the credit card of your choice will cost you in the long run. Another thing to watch out for is annual fees. Sometimes these annual fees will not be worth the savings you get at first with your low-interest rate deals. There is also account maintenance fees you must be aware of. There are many things that may counter act what you think you may be saving, only to be losing those savings somewhere else. Either way the credit card company is getting your money, so as was said time and time again, do your research!
Having bad credit is not a good thing, even if they can get you lower rates. Some of the higher fees you may have to pay in order to make up for your low introductory rates will often be just because you have poor credit. Unfortunately that is something that will be hard to wriggle out from under, but it is just part of life. But what if you have a good credit score?
If you do have a positive credit score, it may be a little harder to find a credit card with lower rates, but not impossible. Again it all comes down to how you are losing the savings that you get from having a low rate in the long run. There are many ways for a credit card company to get their money back that you originally thought that you have saved. It may not sound fair, but it is life after all. We go back to hidden fees that simply outweigh your savings in the end. There are also annual fees to think about that may do the same thing to you and your savings.
Some credit cards will offer something like a zero percent introductory rate for the first fifteen months or so (and maybe sometimes less). That all sounds well and good but how much will you be paying after that time runs out? How much will you be paying after those fifteen months? Will all that money you had saved on what initially looked like a great deal be blown on increased fees down the road? There is no way of knowing if you do not do your research. If you are lazy about your credit card choices, then you may be overwhelmed in the end and you do not want that. Some credit card companies will also claim that there are no annual fees. Again, make sure that you read the fine print and find out if there are any catches. If it looks too good to be true, it probably is. That does not mean that all credit card companies are big and evil and looking to bleed you dry.
You have to remember that these are business and some are simply better than others. Some are honest and some are not. An honest company can save you money as long as you are careful and make sure you do not overcharge your limit. Remember that those fees for going over are there for reason. As long as you are careful and do your research you may be able to find a credit card with low interest rates that are well worth it in the long run after all and is indeed a great deal. Just remember to read the fine print and you should be fine. If you do not understand something, do not be shy about asking for assistance where it is needed. It could prove to assist you quite greatly in the end.