Difficulty with debt
Zero-interest credit cards can be a useful tool – however you should avoid borrowing more than you can afford to repay.
If you are struggling to pay an existing credit card debt, you should avoid spending on credit cards to prevent your debt from increasing further.
Make sure you pay at least the minimum repayment each month on your credit card debt, or you’ll face late payment fees – any 0% interest period is also likely to be cancelled.
If you are struggling to pay your debts, seek advice immediately. A number of organisations offer free debt advice, including Citizens’ Advice, National Debtline and Step Change.
Credit card balance transfer fees
Most 0% interest balance transfer credit cards charge a fee to move a debt to the card. This is normally expressed as a percentage of the amount being transferred. For example, if the fee is 4% and you transfer a debt of £1,000, you’ll pay £40 and owe a total of £1,040.
Make sure you factor in balance transfer fees when choosing a balance transfer credit card, as not all cards charge a fee. Read the terms and conditions carefully as most cards do not offer the same deal on balance transfers and purchases.
For example, your card might charge 0% on purchases for 12 months and 0% on balance transfers for nine months – and it can be confusing to juggle the two schedules. You might also be able to get a better deal if you opt for two separate cards.
Compare balance transfer and purchase credit cards
It’s easier to find a better deal on credit cards if you compare your options on MoneySuperMarket. All you need to do is tell us about yourself and your finances, and we’ll show a tailored list of credit cards for you to choose from.
You’ll be able to sort them by the likelihood of you being accepted if you apply, as well as comparing them by interest rates and any benefits or incentives included. Once you find the card you want, just click through to the provider to finalise the deal.
If your application is successful, the provider will set your credit limit, the length of any zero-interest period and card APR.
Remember this may not be exactly the same as the credit card deal advertised – legally this only has to be offered to 51% of all applicants. The deal you get will be decided by your own personal circumstances.
You’ll get your new credit card in the post, and once you activate it it’ll be ready to use.