College Student Credit Card

Credit card firms are very competitive. They constantly vie with each other to carve out a competitive advantage. One tactic frequently adopted by a credit card supplier is to win new customers by offering to apply zero interest cost in relation to credit card debt they transfer across from their former card firm.

This no-interest-cost offer typically prevails for only a short time horizon, commonly no more than one year. When the offer period ends, the credit card interest rate returns to the then prevailing level.

Credit card firms seem to believe this type of deal does win new customers. Zero interest offers are extended frequently and by many different firms in the industry. Cardholders are attracted because these offers allow them to reap hundreds of dollars in interest savings.

For the customer, the actual mechanics of transferring a credit card balance from an old credit card to a new credit card are quite simple. Many customers choose to request the debt balance transfer online when they apply for the new zero percent credit card. Applying for the transfer at that time maximizes the benefit for the customer since the zero interest period commonly begins when the credit card is approved, not from the date the debt transfer is completed.

Once your new zero percent credit card and debt balance transfer is approved, no further action is required by you in regard to the transfer; all the necessary arrangements are completed by the new credit card company. It contacts your former credit card company and pays off your outstanding debt balance. The net result is that you then owe the new credit company that same amount.

The amount of the outstanding debt balance approved for transfer will depend on a range of factors including your new approved credit limit. It is not unusual for all of the outstanding debt balance to be approved for transfer.

It might be worthwhile highlighting a point frequently overlooked by customers. All monies deposited into a zero rate card account are, in the first instance, used to repay the zero cost debt. Until that debt is paid back in full, the purchase interest rate defined for the new card will apply to all expenditures billed to the card.

Another point to recognize is that the debt balance transferred to your new credit card may be reported as a debit balance on that card before it is reported as a zero balance by your old credit card. If it occurs at all this situation is likely to exist for a brief period, perhaps only a matter of days. It arises for the same reasons that allow the bank holding the originating (or paying) account to debit that account immediately while the bank holding the recipient account applies a credit to that account on a delayed basis, sometimes after several days.

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