Interest Free Purchases Credit Cards

What are 0% purchase credit cards?

These types of cards are great if have no balances on existing credit cards and you would like to buy something expensive but spread the cost over a period of time to make repayments smaller and more manageable. You need to be fairly disciplined in order to get the best from these cards, but if you make regular monthly payments to cover the cost of the purchase within the interest free period then you will take home the rewards. Usually the introductory 0% purchase period is combined with a 0% balance transfer period but this is where the card companies are looking to make money from you.

When you are dealing with credit cards, you need to make sure that you can afford your repayments and dont overspend. The 0% purchase period is usually for a limited period only and unless you repay what you spend within that period, you will be charged interest on the balance at the standard rate. This could work out to be very expensive if you’ve neglected to pay anything off and you may well have been better going for a lower interest rate card instead. That’s why it’s important to select the card that suits you and the way in which you manage your money.

Why choose a 0% purchase credit card?

0% purchase credit cards are best suited to people without an existing credit card debts. If you already carry a credit card balance then you should be paying off your debts before considering any further borrowing. But if you are looking to use this type of card to make an expensive purchase and you’re certain that you’ll cover the balance within the interest free period then this is probably the best option for you. You could almost consider it an unsecured loan but without having to pay the interest!

What are the negatives ?

Because 0% purchase credit cards are usually tied to some kind of balance transfer offer the temptation is to transfer your balance and continue spending without incurring interest charges. But be warned, this is where the credit card companies make their money. Payments you make against your balances will go towards paying off the debt you’ve transferred before anything else. So unless you repay your transferred balance before the 0% purchase period expires, you’ll find that you’ll be paying the standard rate of interest against all purchases regardless of the ‘interest free period�? So be warned, to take full advantage of 0% purchase credit cards make sure that you’ve not got a balance you need to repay first of all.