A credit card balance transfer can be a tremendous help in alleviating the pressure of credit card debt. Conversely, it can also make things much worse for you financially should you use the service irresponsibly. If you're ready to commit to paying down your balance without continuing to accrue charges, and you're ready to take advantage of that low (or no) interest time period, then you're probably prepared to do a balance transfer.

There are several things you need to look for when applying for balance transfers. First, you'll need to know the length of time the low interest rate on your transfer will actually last. Some of the best credit cards offer the same low interest rate on the amount transferred for the life of the balance, but these plans are less common these days. Most credit cards will offer a low interest rate for a set period of time and then go back to the regular interest rate if the transferred balance is not paid in full before that introductory time period ends. If you've transferred a large balance and don't pay it off in time you could wind up paying even larger interest payments than you were paying before you performed the credit card balance transfer.

The next thing you'll need to find out is if you'll be charged a fee for a balance transfer. The fee could either be a flat sum or percentage of the balance you plan to transfer. If you have time to shop around, you may be able to find a credit card that offers free balance transfers. Chances are, you will end up with a card that requires a fee of 3% of the amount you're shifting over. Make sure this fee does not outweigh the amount you'll be saving in interest.

The last thing you'll want to read through thoroughly is the credit card's fee schedule for a listing of the penalties for late or missed payments. Some credit card companies will immediately cancel your low interest rate, jack it up as high as 20% (or more) and charge you a hefty late fee if your payment is made even slightly past the due date. If the credit card you want to transfer a balance to has a universal default clause, your interest rate could increase significantly if you're late paying any of your bills. That's right--you could pay your power bill late and your credit card interest rate could soar!

If you play by the rules that generally apply to low interest and 0% balance transfers, you'll be on the fast track to reducing or even eradicating your credit card debt completely. Be aware of the penalties for late payments and the need for you to pay down as much of your balance as possible before the low-interest period ends and the higher interest is reinstated. After all, you certainly don't want to lose at credit card balance transfer "roulette."

Written by Kacy Suther. A credit card balance transfer with 0% balance transfer can help you relieve debt. Balance transfers available with no annual fee at SmartBalanceTransfers.com .

Article Source: http://www.therealarticles.com

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