PLEASE NOTE: We remain open and we are available for video conference, regular teleconference or in some limited situations will accept in person consultations.

The Law Office of

Donald L. Bell

Free Consultation
240-624-0748

PLEASE NOTE: We remain open and we are available for video conference, regular teleconference or in some limited situations will accept in person consultations.

The Law Office of
Donald L. Bell
Free Consultation
240-624-0748
Consumer Bankruptcy Tax Debt Relief Office in Greenbelt, MD

Are there any downsides to zero-interest credit cards?

If you are like many Marylanders who have decent credit scores, you undoubtedly receive stacks of credit card applications in the mail every single month. Many of these may offer you attractive interest rates, such as 0% APR for a year or 0% APR on balance transfers.

Having high-interest credit cards can be demoralizing. After all, even when your pay more than your monthly minimum, your balances may seem never to decrease. According to reporting from NerdWallet, though, transferring these balances to a 0% APR card may make a great deal of financial sense.

Read the terms carefully

The news may not be entirely positive, as many zero-interest credit cards come with restrictions and drawbacks. Consequently, it is imperative to read the terms of your offer carefully. Because credit card companies have a legal obligation to disclose rate hikes to you, the offer should tell you exactly what to expect.

Do not become complacent

There are thousands of financial institutions that want your business. To entice new customers, these companies may offer zero-interest credit cards. Still, because financial institutions make money from interest, low APRs usually do not last forever. Even worse, your interest rate may increase sooner than you expect.

If you become complacent and rack up too much debt, you may struggle to pay off outstanding balances. You also may continue to use your card after the interest-rate hike, potentially returning you to only being able to make minimum payments.

Ultimately, while zero-interest credit cards can be an effective way to take control of your debt, it is advisable to compare all other debt-relief options.