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Low Interest Credit Cards: Are They For Real?
By: Morgan Hamilton
Credit cards are very common nowadays. In fact, some surveys show that 81% of
the American households have at least one credit card.
However, most financial experts contend that these facts are not on its positive
aspect. This is because most of the people who belong on this percentage have
more than $8,000 credit card debt.
In reality, that is really a big amount. But one might wonder on how these
people were able to accumulate such big debts.
Experts say the trend of credit cards today is very addicting. There are those
who assert that it is the consumer’s lifestyle that must be blamed. While others
say, the problems are based on the interest rates.
According to the consumer credit website, the average interest rate of one
credit card is nearly 18.9%. It is pretty obvious that the amount is not at all
fair. Getting to pay some debts with almost 20% of additional charges brought
about by the interest rates would really lead the consumers to bigger debts.
Interest rates are usually charged by the credit card company once the user had
accumulated some balances on his or her due payments. The problem is that most
people tend to pay their minimum balance only. In fact, 48% of the credit card
users were known to pay their minimum balances only.
What happens next is that the remaining balance is carried off to the next
monthly billing statement, which, in turn, would only aggravate the situation.
Pile after pile, the debt becomes bigger, but certainly not brighter for the
user’s financial future.
This is where low interest credit cards take its fair share in the limelight.
With the alarming condition in the credit card industry, more and more people
are trying to look for the best credit cards with low interest rates.
In reality, it is not so hard to find low interest credit cards. The problem is
that not all credit card companies that offer low interest rates are created
equal. This goes to show that there are some companies that only use this very
motivating factor so as to amass more consumers.
Hence, there are many instances wherein people are attracted to get credit cards
because of the so-called low interest rates, only to find out that the interest
rates are just one of those fraudulent promotions known as “teaser rates.”
With these low interest credit cards, they would usually offer some tempting
deals to the public. The credit card companies would be more than willing to
provide lower interest rates like low introductory APR or annual percentage
rate.
However, most experts contend that lower interest credit cards only motivate
people to make more purchases. They have this common notion that it is just okay
to make many purchases because the interest rates are just small.
So for those who fall many times to this kind of situation, it is best that they
analyze their standing first. Never grab a low interest credit card instantly
because what goes with the promotion may not be long lasting.
And so, here is a list of some tips that can be used in analyzing and
interpreting some facts about low interest rates in credit cards.
1. The promotion is very limited
In reality, low interest credit cards are especially built to make shopping
easier, more fun, and extremely economical. That is why according to some
surveys, most of the advantages of low interest credit cards are absolutely
dependent on the duration of the promo.
For instance, a particular credit card may have low interest rates because of
its low introductory annual percentage rates. The problem sinks in if the person
failed to understand that this promo is only limited within the introductory
period.
Therefore, after the introductory period, regular charges will usually apply.
2. It is extremely important to read the fine print
Having low interest credit cards is not exactly a bad thing. What makes the
situation worse is through the effects of not reading the fine print.
In reality, almost 75% of the consumers who are heavily buried in debt were not
able to understand the things written on their cards fine print. In fact, they
confessed that they did not even read it.
So the bottom line here is that people should not focus more on having low
interest credit cards. If their primary reason is to save more money, then, it
is best not to get a credit card at all.
Besides, interest rates are only applicable to those who have overdue payments
or who have carried over the balance of the previous bill.
Therefore, whether the credit card’s low interest rates are for real or not, it
really does not matter for those who do not carry a balance on the next bill or
those who pay their dues on time.
About the Author:
Morgan Hamilton offers expert advice and great tips regarding all aspects
concerning Credit Cards. Get the information you are seeking now by visiting
www.findqualitycreditcards.com/categories/low_apr_interest_credit_cards
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