0% Credit Cards
| Card Supplier | Intro 0% Balance Transfers | Typical APR | Intro 0% Purchases | Apply |
|---|---|---|---|---|
 Virgin Credit Card |
0% PA for 16 months (2.98% fee) |
16.6% APR | 0% PA for 6 months | |
 Halifax All In One |
0% PA for 9 months (3% fee) |
15.9% APR | 0% PA for 9 months | |
 Bank of Scotland All In One |
0% PA for 9 months (3% fee) |
15.9% APR | 0% PA for 9 months |
A 0% purchases credit card is something that most of us have spared a glance at with a “Should or Shouldn’t I?” frown at some point.
This is an extremely popular package offered by most credit card companies, and it’s easy to see why. The idea is that you borrow money for short term needs and pay it back without having to cover the extra costs of accrued interest. It sounds fine on the surface, and to a certain extent, it is. But be careful what you agree to, especially if you’re combining a 0% purchases card with a 0% balance transfer offer.
For some people, short term financial needs mean that there’s no alternative to the dreaded credit card. The best that they can hope for is to use the 0% purchases for their needs and pay the money back before standard credit card interest rates kick in. With typical APR hovering at the 15% mark, it’s easy to see why so many people are tempted by the introductory offers claiming interest-free repayments.
If you have the restraint not to rack up more debts that you can afford to pay, these 0% purchase offers are a great deal. But bare in mind that they’re only introductory offers and the ultimate goal of the credit card companies are to shift you on to a repayment rate which is going to prove fruitful for them, and not so much for you.
As we mentioned, it’s possible to combine debts and shift them across on a 0% balance transfer. Many 0% balance transfer now come with the same introductory 0% purchases clause. But this is where you have to be on red alert, because if you take a wrong step, you’ll be paying through the ear.
Always ensure that the 0% balance transfer coincides with the 0% purchases term. In other words, they should be the same length. What happens when the 0% purchases term is shorter than the balance transfer? Miserable faces is the best way to describe what happens.
Credit card sharks make an absolute fortune by using a lowly tactic known as Negative Payment Hierarchy. What this essentially means is that if you make a purchase after your 0% purchases period has expired, you’ll probably be expecting to be charged interest on the highest debt, right? But this isn’t the case. The credit sharks will purposefully wipe out the lowest debts in the knowledge that leaving the larger chunks to accrue interest will be much more prosperous for them.
So while you’re paying off what you think is your largest debt, you’re actually contributing towards the smallest. The rest will be charged interest at the full whack and you’ll rapidly begin to regret your spending.
0% purchase cards can be great if you use them in the right manner. But do be extremely careful when they’re thrown in as a bonus to another scheme. They’re very rarely a bonus, and nine times out of ten, they’re actually more of a hindrance. Don’t fall in to the trap.
