Editor’s note: This is a recurring post, regularly updated with new information and offers.
Credit cards with 0% annual percentage rates provide the advantage of avoiding interest payments on purchases, balance transfers or both for a limited duration.
But it’s important to note that the specific details of each card can vary significantly, with some offering longer introductory periods and additional perks compared to others. Additionally, charges associated with these cards, such as annual and balance transfer fees, can differ.
Before applying for a 0% introductory APR credit card, it’s essential to consider the following things to make an informed decision.
Check the offer type and length
While most 0% APR cards offer zero interest for at least 15 months, certain cards provide 0% introductory APRs that extend up to 21 months. The length of the offer is significant because it determines the period during which you will be exempt from paying interest. It signifies the duration before your credit card’s interest rate resets to the regular APR.
For instance, if you have a substantial purchase to make and require approximately a year to pay it off, any of the 0% introductory APR credit cards with 15-month introductory offers could be suitable. However, if you are dealing with a significant amount of high-interest credit card debt that needs to be paid off, it is advisable to seek out the longest 0% introductory offer available.
Additionally, 0% introductory APR credit cards offer their promotional rates for either purchases, balance transfersor sometimes both. In certain cases, these cards may even provide different timelines for zero interest on purchases and balance transfers.
For instance, you might receive 0% interest on purchases for 12 months while enjoying a 0% introductory APR on balance transfers for a longer period of 18 months.
Lastly, read the fine print to make sure you’re not missing anything and that you qualify for the offer you’re looking for.
Are there any rewards or perks?
Several credit cards that offer introductory APR periods also provide the benefit of earning rewards. However, it’s important to note that opting for rewards usually means sacrificing the length of the zero-interest offer.
Nevertheless, numerous cards offer both introductory APR periods and ongoing rewards, albeit with a shorter duration of 0% interest (typically up to 15 months).
Also, ensure that your card offers perks that align with your preferences or offer benefits that you can make the most of. Common benefits include extended warranties, cellphone insurance, travel insurance and purchase protection against damage or theft.
What credit score do you need to apply?
While looking into the card details, it’s key to consider your eligibility for the desired 0% APR card. The top cards in this category generally require applicants to have a good to excellent credit score, so not everyone will qualify.
Before submitting your application, check your credit score to determine your realistic chance of approval. This step allows you to assess your creditworthiness and decide which cards to pursue.
What kind of fees are included?
Lastly, ensure that any card you’re considering has fees you’re comfortable paying. Here are some common fees associated with 0% APR cards:
Annual fees: While most credit cards offering a 0% introductory APR do not charge an annual fee, this may not always be the case. Verifying whether an annual fee applies to the card you are considering is essential.
Balance transfer fees: If you plan to consolidate debt using your new 0% introductory APR credit card, the balance transfer fee becomes significant. While most cards in this category charge a balance transfer fee of 3%, a few cards charge up to 5% instead. Opting for a card with the lowest possible fee will help minimize the cost of transferring a balance.
Foreign transaction fees: This fee is relevant if you intend to use the card for transactions overseas or with non-U.S. merchants online. If you frequently travel, avoiding cards that charge foreign transaction fees is advisable. Alternatively, you can consider using another card from your wallet when you are abroad to avoid these additional charges.
By carefully considering and evaluating these fees, you can select a credit card that aligns with your financial preferences and minimizes any potential expenses.
Bottom line
Picking a 0% introductory APR credit card may feel overwhelming, but by looking into factors like required credit scores, associated fees, additional card perks and the offer duration that aligns with your repayment timeline, you can narrow down your options.
It’s important to note that in most cases, there are multiple 0% introductory APR credit cards that can suit your needs. Once you have researched and confirmed that your credit is likely sufficient for approval, applying before the offer expires is key.
In most cases, a 0 percent APR is a special promotional interest rate. The benefit of credit cards offering a 0 percent intro APR is that you can borrow money for a limited amount of time — usually between 12 and 21 months — without accruing any interest on your qualifying credit card balance.
In most cases, a 0 percent APR is a special promotional interest rate. The benefit of credit cards offering a 0 percent intro APR is that you can borrow money for a limited amount of time — usually between 12 and 21 months — without accruing any interest on your qualifying credit card balance.
You'll typically need good or excellent credit (a score of at least 690 on the FICO scale) to qualify for most 0% APR credit cards. The ongoing interest rate, which is charged once a card's promotional period ends, will also depend on your creditworthiness.
You may be able to secure a 0% APR offer by requesting one from your credit card issuer. Offers are generally for balance transfers, but some issuers also offer pay-over-time plans or credit line loans. Using your card responsibly and negotiating a retention offer can increase your chances of getting a 0% offer.
If you're disciplined to make on-time payments and pay off your balance before the intro period ends, then you will likely do well with a 0% APR credit card. However, if the 0% tempts you to overspend, you may face paying high interest charges if you're still carrying a balance after the intro period.
A 0% APR is not good for your credit if you overspend, as high credit utilization and missed payments hurt your credit score. If you end up carrying a balance from month to month after the 0% period ends, you will also owe expensive interest charges, making it hard to pay your bills on time and build credit.
These deals are real, and you won't pay any interest on your car loan. However, that doesn't mean they're the best deal for you. Even without interest payments, you could still pay more overall. That's because taking a 0% financing deal will usually make you ineligible for manufacturer rebates offered on new cars.
To get a 0 percent APR card, you typically need a FICO credit score of at least 670 or a VantageScore credit score of at least 661, putting you in the “good” and “prime” ranges, respectively. Having a FICO score of at least 740 or a VantageScore of at least 781 increases your chances of approval.
A 0% APR credit card can work better for you if you plan on making a large purchase and don't anticipate paying the balance anytime soon. However, if you plan on paying the balance in full after each billing cycle and want to minimize costs, then a no annual fee card would be recommended.
Interest-free loans are a high risk offer for lenders, so they'll only approve you if they're confident you can pay every month. Before committing, ensure you can afford the monthly repayments and understand the full terms and conditions of the offer, including what happens if you miss a payment.
A 0% credit card has an introductory or promotional 0% interest rate for a limited period. Usually the 0% interest rate applies only to certain transaction types, such as card purchases or balance transfers.
Owning more than two or three credit cards can become unmanageable for many people. However, your credit needs and financial situation are unique, so there's no hard and fast rule about how many credit cards are too many. The important thing is to make sure that you use your credit cards responsibly.
While a 0% utilization is certainly better than having a high CUR, it's not as good as something in the single digits. Depending on the scoring model used, some experts recommend aiming to keep your credit utilization rate at 10% (or below) as a healthy goal to get the best credit score.
Avoiding interest is always a good goal, but zero-interest loans can lead buyers to overspend and come with a lot of strings attached. Carefully evaluate your purchase—is this what you intended to buy, and will you realistically pay off the loan within the given time?
It's a good idea to pay off your credit card balance in full whenever you're able. Carrying a monthly credit card balance can cost you in interest and increase your credit utilization rate, which is one factor used to calculate your credit scores.
Carrying a balance can negatively impact your credit score by increasing your credit utilization ratio. It is important to have a plan to pay off any balance before the end of the 0 percent intro APR period, and to make at least the minimum monthly payments on time.
A 0% credit card is a credit card with a 0% introductory/promotional interest rate available for a set duration. This means you can spread costs by paying off less than the full amount each month and still pay no interest. Once the offer ends, the standard rates will apply to the remaining balance of your card.
What Does 0% APR Mean? Spelled out, APR means annual percentage rate. In the context of a credit card, the APR is the same as the interest rate. “Zero percent APR” means no interest is being charged.
Avoiding interest is always a good goal, but zero-interest loans can lead buyers to overspend and come with a lot of strings attached. Carefully evaluate your purchase—is this what you intended to buy, and will you realistically pay off the loan within the given time?
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