Proper use of a lifetime balance transfer credit card

Lifetime balance transfer cards are great tools that allow the card holder to transfer an existing debt from one credit card to another. The added benefit is that users only have to pay one single interest rate throughout the duration of their consolidated debt. However, card holders should be sure to use the lifetime balance transfer credit card effectively to save the most money.

As soon as users obtain their new cards they should transfer their current balance as quickly as possible. Some credit cards impose a limit of 30 days to transfer over the balance from the old credit card, and failure to do so will essentially null and void the features of their new card. Another advantage to transferring balances as soon as possible is that the lower interest rates will be utilised sooner and well ahead of the introductory period’s expiration.

Ideally, card users should transfer the balance when the card application is submitted. Each card application includes a section for account details that can initiate a balance transfer. While filling out the application, card users should also find out the terms of the card, such as how to activate the lifetime rate and what actions can terminate the rate.

As with all credit cards, a payment plan is essential. Just because the card locks in the interest charged on the balance transfer (not the credit card), doesn’t mean money cannot be wasted and additional debt accumulated. A lifetime balance transfer simply locks in the interest rate, providing confidence that the rate on the balance transfer will not rise. Card holders will still be required to make substantial repayments if they hope to eventually eradicate the debt. A good repayment plan consists of enough capital to pay down the debt within a timely manner while accounting for necessities and unforeseen events.

In the worst case scenario, the minimum payment should be made. Failure to do so will incur additional fees that will be added to the account. Perhaps more damaging is that the lifetime rate may be suspended, resulting in the balance transfer reverting to the standard interest rate.

A lifetime balance transfer card should be for the sole purpose of transferring the existing debt from one card in order to pay it off at lower interest. Any purchases and cash advances will create a separate section of the total debt on the card and will not be paid off until the balance transfer is satisfied. The user will then accrue interest at the standard rate until the balance transfer has been cleared.