Obtaining a credit card is a clever way for shoppers to keep back-up funds and build credit history at the same time. Credit cards give an individual spending power, which they will need if they have a financial emergency like a car repair or medical issue. Unfortunately, most credit card offers have interest rates that can reach or exceed the 18 percent mark. The average person will have a hard time finding a card with a low interest rate, especially if they have little or no credit history. Chase down credit card rewards with our FREE credit card chaser! Continue reading to find low introductory rate credit cards!
High interest rates are a turn-off to shoppers and may compel them to use cash for their purchases. Smart credit card companies began to notice this, which is why they began to offer low introductory rate credit cards. These cards entice shoppers by offering low rates on purchases for six months to one year. When the time expires, the annual percentage rate goes back to normal and shoppers must return to being cautious with their spending.
Some may feel as if these offers are deliberately trying to trap individuals who are in desperate situations. These offers are tough to resist, and they can cause a person to put their better judgment behind their impulsive thinking. It is easy to blame the credit card companies, especially the ones using slick marketing tactics to lure consumers into making a commitment. Some even go as far as sending checks in the mail and asking consumers to pay one of their bills with the checks. If the consumer does use the check, they have just made a commitment, whether they realized it or not.
Credit card companies can advertise as they please, no matter how slick their tactics are. It is up to the consumer to read the terms of the low introductory rate credit card before taking any type of action. Individuals should never feel intimidated or desperate enough to make a rash decision. It makes no sense to use the card today just to have bill collector issues and low credit scores in the future.
Credit Card Types, Terms, and Benefits
Credit cards are either secured credit cards or unsecured credit cards. Secured cards are usually backed by cash deposits and are ideal for individuals who are trying to build a credit history. Unsecured cards are not backed by anything, and only individuals with established credit histories can obtain them. Low introductory rate credit cards are typically unsecured cards with interest rates that range from 0% to 5%. People with excellent credit ratings are usually the only ones that can receive zero percentage rate cards. Consumers with average to good credit scores who receive cards will pay some interest, even if it is a very small amount. One can always check for No Credit History Credit Cards.
Consumers should also read the fine print to see what other fees the card may have. The card may have an annual fee, which one must pay even during the introductory period. It may also have a late payment fee, which shoppers can avoid by paying the bill on time. Other fees may include cash advance fees, balance transfer fees, and over-the-limit fees. It is also imperative to find out whether the interest accrues or not during the preliminary period.
To entice shoppers even further, low introductory rate credit cards may come with perks and benefits that shoppers can actually use. This can include roadside assistance, towing services, lock-out services, and card replacements. Some shoppers may already have these services with their existing car insurance policies. They can still use the added protection because when a breakdown or lockout occurs, it is always nice to have more than one option.
Once a shopper reads the fine print, they will realize these cards are not as attractive as the advertisement makes them out to be. The terms and conditions can actually hurt a consumer financially if he or she is not careful. So why would someone risk their credit history on one of these cards if they have so many stipulations? Check credit card reviews to insure you are getting the best rates possible!
Many circumstances can answer this question, but paying off an existing credit card is one of the most popular reasons for obtaining a low introductory credit card. Individuals who have an existing credit card with high credit card interest rates can transfer their balance to the lower interest rate card. This will give them a chance to:
- Receive a new line of credit under a new set of rules
- Eliminate a looming debt and start from square one
- Get rid of finance charges and lower their monthly payment
- Reduce the possibility of credit card default
- Avoid severe issues such as law suits and possible wage garnishments
- Keep themselves from dealing with bill collectors and/or filing for bankruptcy
This is a credit card offer that will allow a person to start fresh. It will not wipe a person’s debt away or give them a better credit score. The individual will still have a credit card in his or her name, and they must change their habits or they will face the same issues. Paying off their debt within the introductory time period is the quickest way for them to eliminate their debt and increase their credit score. If they fail to make wise decisions within that time period, they may find themselves searching for a second low introductory rate credit card.
Low Rate Credit Cards and Emergencies
Someone who is dealing with an emergency may take advantage of this card as well. Life’s unfortunate surprises such as accidents, car malfunctions, illnesses, and home-related issues are expensive to fix. The average person may not have the cash on hand, especially if they have existing obligations and bills. The only options that remain are personal bank loans, personal loans from friends and family, and credit card offers.
Personal loans are difficult to receive because banks do not know what they are for. Car loans and home loans have a specific purpose while personal loans do not. This can make a bank uneasy, which is why they charge a higher rate of interest for these type of loans. Applicants need to have a flawless credit background and plenty of patience because the approval process can take days or weeks.
This will not work for a person in an emergency because they need immediate cash fast. They can try to borrow large sums of money from friends and family but this rarely ends very well. If the person’s family members are not rich, lending money can put them in a bad financial situation. It can also cause rifts and arguments in the future, especially if the person cannot pay back the money in a timely manner.
Credit cards are a simple solutions for people in financial binds. Low introductory rate credit cards are an even better solution. Persons in emergency situations can receive this card, take care of their emergency costs, and pay off the debt before the high interest kicks in. Try our FREE credit card calculators and prepare your budget for the things to come!
Emergency travel expenses may also compel a person to apply for this type of credit card. Someone may need to travel suddenly because of a death in the family, a new job offer, school obligations, or a number of other reasons. Depending on how far a person is traveling, they may need to purchase airplane tickets, rent a moving truck, or make temporary lodging arrangements. None of these services come cheap, which is why a person may need a credit card to help them handle these costs.
Low introductory rate credit cards can work in a person’s favor if they use discipline and discernment. Thoroughly exploring every option will bring about the best results. Credit card offers always arrive in the mail, so there is no reason to apply for the first enticing offer. Keep the most reasonable offers for emergency situations and throw out the ones that have too many confusing terms and conditions.
Paying on time and avoiding unnecessary fees is the key to making these cards work. Resist the urge to max-out the card and avoid converting the credit into cash. This can create more debt, more charges, and more problems in the future. With a bit of self control, low introductory rate credit cards can solve short-term financial problems and long-term credit issues. Compare credit cards for FREE with our Credit Card Chaser!