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Focus On: Average credit? 0% balance transfer card from Capital One

Focus On: Average credit? 0% balance transfer card from Capital One

Being declined for a 0% balance transfer credit card when you just want to get your finances in order can be really frustrating. Fortunately, the Capital One Balance Card – which is available only through MoneySuperMarket – can help, even if your credit score isn’t up to much. Here’s what you need to know.

What’s the deal?

The Capital One Balance Card charges 0% interest on balance transfers until August this year and, crucially, is available to people with an average to good credit history. There’s a 3% fee to pay on the sum you transfer and the card comes with a maximum credit limit of £1,500.

Who is it good for?

This card is aimed at people with outstanding credit card balances they want to stop paying interest on, but who might have been turned down for other 0% balance transfer cards because their credit score wasn’t up to scratch.

Alternatively, this card might also suit someone with little or no credit history, and can be used responsibly to build your credit score (Naomi Caine explains how this works here).

Finally, as you won’t find the deal anywhere else, it’s for MoneySuperMarket customers only.

Any catches?

Aren’t there always? The main catch with this card is that after your August statement arrives, the 0% period on balance transfers ends, and the card’s representative Annual Percentage Rate (APR) rockets to 34.9% (variable).

This is really expensive (the average UK credit card APR is closer to 18%) and could make matters worse for your credit score if you fail to clear your balance by August and then struggle to keep up with relatively high interest payments until you can clear the balance.

And remember, that’s the representative rate, which only has to be offered to 51% of successful applicants. The rate you actually get depends on your personal circumstances and could be higher.

What’s the verdict?

If you’re struggling to clear a credit card balance and can’t get accepted for other balance transfer cards, this could be an option – as long as you’re confident you can clear the balance by August, after which time, things will get expensive.

Remember that it could take as long as a month to receive the card after you’ve successfully applied, and so your 0% window will be shorter still.

This is the only card on the market offering customers with lower credit scores a notable 0% period on balance transfers, so if it sounds like the right deal for you, strike while the iron is hot.

Top tip

If you’re getting rejected for the best credit card deals because your credit score doesn’t pass muster, there may be ways you can improve it. In her article, Credit scores – why they’re important, Rachel Wait explains what might have damaged your credit score in the past, and the things you can do to start improving it.

For example, there may be mistakes in your credit history unfairly damaging your score. Get these mistakes corrected and your score could improve, increasing your chances of being accepted for the best deals.