0% Intro APR Credit Cards

What is a 0% APR credit card?

A 0% APR credit card is a card that offers no interest on purchases for a limited period, typically 3 to 21 months, depending on the card and your creditworthiness. It will allow you to make purchases up to a certain credit limit and you’ll have a monthly minimum payment you need to pay to maintain the balance.

What does 0% APR mean on a credit card?

0% APR means the card has an introductory offer of no interest rate (also called APR – annual percentage rate) on purchases made within that period. That means if you spend $2,000 in that period and pay it off before the period ends, you’ll still only have spent $2,000.

How does a 0% APR credit card work?

A 0% APR credit card offers you an introductory period in which you will accrue no interest on your purchases. For example, if you got a card that had a 0% APR period of 12 months and you used it to purchase a new bathroom suite, you would have the full 12 months to pay it back before the balance started to accrue interest.

In other words, you can spread the cost of your purchases over that time frame and not pay anything for doing so.

Why do credit cards offer 0% APR?

Offering a 0% APR period makes using their credit card more attractive and encourages people to spend more. While diligent borrowers will pay off (or transfer) the balance before the 0% period ends, many don’t, which leaves them paying a high percentage of interest, which ultimately makes the card issuer money.

What is the difference between 0% APR and low interest credit cards?

A 0% APR credit card will only offer you that interest rate for a limited period – typically 3 to 21 months. After that, your interest rate will increase to a much higher rate, typically 16-24% or even more.

A low interest credit card usually doesn’t have an introductory period, or if it does, it will be much longer than a 0% APR period. Most low interest rate cards offer a constant interest rate of 5-16%, making spending more affordable for good.

What can a 0% APR credit card be used for?

A 0% APR card can be used for anything you can pay for with a card, but it’s generally a good idea to have a plan for what you want to use the 0% APR period for. Some ways you may choose to use your card are:

• To spread the cost of a vacation
• To spread the cost of holiday gifts
• Pay for a large repair on a car or your home
• Pay for new major furniture
• Pay for new technology

What are the pros and cons of 0% APR credit cards?

PROS

• You can spread the cost of big expenses without paying anything for doing so
• 0% APR rarely have fees
• You can buy or pay for things now you otherwise wouldn’t be able to yet

CONS

• Interest rates are generally high when the 0% APR period is over
• They make it attractive to spend more than you need to
• You may buy things you would have changed your mind about had you needed to save for it
• Some store credit cards defer the interest

How do I do a balance transfer to a 0% APR credit card?

You need to make sure that the card you’re looking at includes balance transfers in their 0% APR offer, otherwise you’ll find yourself paying a huge amount in interest on debt you could have paid off elsewhere. If they do offer a 0% APR period on balance transfers, then you’ll be able to request a balance transfer on your card’s online account management site. (You’ll have logged in there to activate your card.)

What is the best 0% APR credit card?

The best 0% APR credit cards offer a huge 21 months of interest-free spending. Some of the best cards are:

• S. Bank Visa Platinum Card – offers 20 months (billing cycles) of 0% APR
• Wells Fargo Reflect Card – offers up to 21 months of 0% APR
• Citi Custom Cash Card – offers 15 months of 0% APR

Of course, what card is best for you and your circumstances may differ from these. Make sure you use our comparison tables to find the best 0% APR credit card for you.

Is a 0% APR credit card good for your overall credit?

Your credit history won’t “know” that the card you got a card with a good 0% APR offer, so from that point of view, it won’t make any difference. Any new credit card account will bring your credit score down temporarily simply because that’s the effect hard credit searches have.

Paying your card on time will help bring it back up, but making a new large purchase may bring up your credit utilization percentage, which is best kept below 35% if you want to maintain your high credit score.

How do I qualify for a 0% APR credit card?

To qualify for worthwhile 0% APR introductory periods, you’ll need a good or excellent credit (typically 650 or more) and a healthy debt-to-income ratio.

How to apply for a 0% APR credit card

To apply for a 0% APR credit card, you need to first compare cards to find the one that’s right for you. This will depend on your credit score and what you need to use the card for. The longer the 0% interest period the better, but if you have a score at the lower end of what a lender accepts, you’re likely going to receive a shorter 0% APR period.

Most credit cards now offer preapproval via a soft search of your credit history (which means it won’t hurt your credit score) and will tell you what terms you’re likely to get if you apply to them. Take advantage of this if it’s available so you know whether or not the card would be suitable for you.

Once you’ve chosen the right card, all you need to do is apply. This usually only takes a few minutes and you typically get an instant decision, with the card in your hands within 10 days of approval.

Compare 0% credit card offers

A 0% interest credit card can be an incredibly smart way to borrow, provided you find the right card and manage your repayments properly. Make sure you fully understand the terms of a 0% interest period before you apply.

Have you decided a 0% APR card is the right choice for you? Start comparing 0% APR credit cards here to find the right one for you. When you’re ready, all you need to do is apply and you’ll soon have the interest-free funding you need.