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Risks Behind Credit Card Companies' Interest Rate Offers

Credit card debt seems scary and can lead us to want to jump at the first card offer of "zero interest for six months". We think that this is a great offer so we can transfer a higher interest card balance to the new card, and then have more time to pay off the balance. Credit card companies that offer things such as low interest rate for a promotional time usually carry added risk. Credit card users need to be aware of these risks, or they can get into a lot of debt trouble.

The risks involved with these card companies' offers can be financially crippling to card holders. Especially those who have struggled with paying off debt in the past, for some of these card if a borrower does not pay the balance off in full by the end of the promotional offer they can be hit with high interest rate charges. Other risks are, if you transfer a balance to a new card or make large purchase on that card for the zero interest rates, any additional purchases made on the card will be charge with the full interest rate the card possesses. Cards that have the low interest rate offers for a certain period usually have unexpected interest attached to them.

Not all credit card companies are sneaky with their terms and conditions of interest rate offers; some companies alert customers that they will have to pay interest if additional purchases are made on the card. For those companies who do not inform potential customers about their interest rate changes, one should be aware of how to avoid being caught in card companies' interest rate promotions.

Here are some tips to be aware of with these promotions:

· If you do decide to take the new card offer then do not make new purchases until the promotional balance is paid off. For purchases of other items use cash or debit cards.

· Make sure you read all the terms and conditions of a promotional offer, and what interest you will have to pay.

· If transferring a balance note that some card companies charge transfer fees that can turn out to be a good amount of money when they charge a percentage of your current balance on that card.

· Remember that if you decide to transfer a large balance to one of these card offers and your balance takes up most of the credit limit on that card, then you are at risk of hurting your credit score until that balance is paid off.

Knowing what one is subjecting themselves to when opening a credit card that offers low interest rates for a certain amount of time is important to avoid adding debt to your financial situation. Keep in mind the tips above if thinking about a credit card company's offer on interest rates. If you have been affected by such risks from these offers, you can always contact an experienced attorney in credit card debt, and see your options to get you on track to a debt free life.

Work Cited:

Carrns, A. (2014, September 22). Risks can lurk behind offers. Tampa Bay Times.

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