This time last year you could pick up a 0% purchase card with an interest free period of 12 months and a 0% balance transfer card with a 13month offer. Now however, these deals are commonplace and a new offer from Capital One is arguably the best yet.
So what's the deal?
The Capital One Platinum card now offers 0% on both balance transfers and purchases until September 1, 2009. This makes it the longest combined 0% offer on the market at close to 15 months.
The appeal of a combined 0% offer is that you don't have to worry about one interest-free period ending and negating the benefits of the other deal. For example, if you had a card with a 0% offer on balance transfers for 12months and a 0% purchase period for three months the natural temptation would be to spend during those first three months. However, as soon as that three-month 0% period expires you start accruing interest on the purchase unless you can pay off the whole balance. For more details read our article 'the interest-free credit cards that may charge you interest'.
With the Capital One deal however, this needn't be a concern. You have nearly 15 months to chip away at your existing debt and any additional purchases without being charged interest. Even when the 0% period ends the typical APR is relatively low at 12.9% - the balance transfer fee is fairly typical at 3%.
As an added bonus, the Capital One Platinum Card also offers a free identity theft service and if you register online you can receive identity theft alerts from Equifax. It's a timely offer with the Association for Payment Clearing Services (APACS) revealing that card theft rose by 25% in the past year to £532.5m.
The identity theft service provides help and advice as well as your own named adviser in case you become a victim of identity fraud. You'll receive emails within seven days of any key changes to your credit file, along with a monthly message to offer peace of mind that nothing has altered in your file. This is particularly useful as statistics from Experian show that 55% of identity theft victims only discover fraudulent activity when looking at their credit files. With this protection, your credit report is effectively checked for you, so you needn't be concerned.
If you have an excellent credit rating and are looking for a new credit card this is simply the market leader - so apply now.
Are there any alternatives?
The credit card market is highly competitive and there are certainly other options if you decide the Capital One deal is not right for you.
If you have an existing debt and no plans to spend any further cash then you may prefer the Virgin Credit Card. This has the longest 0% balance transfer offer on the market at a full 15 months and it has a slightly lower balance transfer fee than the Capital One card at 2.98%. Just be careful not to spend on this card - it has a 0% purchase offer for three months but again, once that period expires interest on new purchases will quickly add up.
There are other credit cards which offer 0% on both balance transfers and purchases for equal periods. Capital One itself has an exclusive deal available through moneysupermarket.com which offers 0% on purchases and balance transfers until May 01, 2009. It also offers identity alerts, has a 3% balance transfer fee and a lower APR at 11.9%. The Halifax All in One card and Bank of Scotland All in One card both offer 0% on purchases and balance transfers for 10 months with typical APRs at 15.9% and balance transfer fees at 3%.
If its identity protection you want, the Egg Card is also worth considering as it includes active fraud monitoring and an internet shopping guarantee. It offers 0% on balance transfers until September 2009 (3% balance transfer fee applies) but purchases are only interest-free until September of this year so this is another card that shouldn't be used for both purposes. For added peace of mind, the Egg Card also includes free purchase in transit protection - covering items from £25-£1,000 if they are damaged, lost or stolen within the first 30 days; and free travel accident insurance.
The key to all of these deals however, is that they are only available to customers with excellent credit scores. Generally this means you have no previous credit defaults, you have had a credit card for at least five years with a limit of at least £5,000 and you have never missed more than two payments on a credit card or loan.
What if you don't have a good credit score?
If your credit score is less than exemplary you still have options but there's no point in applying for the market-leading deals as rejections only further harm your credit profile.
Though card providers are tempting the most reliable borrowers with attractive rates they're making life more difficult for people with poor credit ratings. Since the turn of the year, there have been a number of increases to rates and charges with some cash rates hiked by more than 7% and purchase rates increased by as much as 3%.
There are still attractive deals out there such as the Barclaycard Platinum Credit Card with Purchase and Long Term Balance Transfer, which offers 6.5% interest on balance transfers until paid in full and 0% on purchases for 10 months. However, before applying for any deal you should shop around with the Smart Search tool to find cards that you are likely to be accepted for based on an assessment of your credit profile. It only takes minutes to fill out and could help you get back on the market with a competitive deal, without suffering further rejections.
Have your say: Are you struggling to be accepted for credit? Or do you have any tips for those in financial difficulty? By visiting our forum you may find you can help others or receive advice yourself.
Disclaimer: Please note that any rates or deals mentioned in this article were available at the time of writing.
Rate This Article
Click on a star to rate this article.
