What You Should Know About Intro Rate Credit Cards

Using a credit card with an introductory 0% APR can be a great way to make a large purchase or reduce credit card debt. Before you go applying for one of those cards, you should take some time to understand that intro offer. Here’s what you should know.

Intro is Real

As the name suggests, a 0% APR offer is only for an “introductory” period.

• Introductory Period. According to the Consumer Financial Protection Bureau (CFPB), all 0% intro offers must be for six months, but some are longer than that.
• Go-To Rate. Make sure you note when your intro offer ends so that you have a roadmap for paying off your balance completely by then. This information must be disclosed according to CFPB regulations. 

The Transfer

If you’re using the card as a balance transfer, remember that there is a deadline for requesting and completing it.

• Deadlines for Balance Transfers. Some cards offer you 60 days to request and complete the transfer, some less. Keep in mind that it can sometimes take up to 21 days for a transfer to be completed.
• Transfer Fees. Also, remember that there could be a balance transfer fee. Typical fees range from three to five percent of the amount you want to transfer. 

Interest on the Horizon

Once the into period ends, any balance you have on that card will begin to accrue interest charges. That interest charge can sometimes be quite high. Make sure you have a plan to pay off your balance in full before that intro period ends. 

Do One Thing: Carefully read the terms of your 0% intro credit card before signing up. Make sure you have an attainable plan to pay off the card before that intro ends.