Why 0% APR credit cards are better than - finance magazine
You see the deals all the time offered by large retail stores: "Get 0% financing on all devices! "or" Pay no interest until next year on all the furniture! "so, if you take advantage of these offers? It is probably not a good idea. While these offers may be tempting, if you really need to defer payment of a large purchase, get a credit card with a 0% intro APR is better than taking a store financing agreement. Why? Let us explain.
0% APR credit card vs store financing
How they affect your credit score: The main reason you do not want to financing store is because of how it can be reported to the credit bureaus. According to FICO, the company that compiles credit scores typically used by lenders, much of the funding from the store is generally classified as "lender of last resort", which generally are not good for the credit bureaus and can lower your overall credit score. Credit cards with 0% intro APRs can actually improve your credit score by increasing your credit utilization. This measure your rate limit of balance on your credit cards. Suppose your total credit limit is $ 10,000 and your total balance is $ 1,000. Your credit utilization rate would be 10%. If you cut your $ 5,000 credit limit, but your balance remains $ 1,000, your ratio is now 20%. The higher the ratio, the more damage is done to your credit score.
How are versatile: With funding from the store, you only get 0% interest on your purchase, be it furniture or a new TV. If you get a credit card introductory APR 0%, you can use any advantage of interest to any purchase you want, be it a big-ticket item or a bunch of small gifts you are search scratching your Christmas list. The intro 0% APR credit card gives you more versatility regarding what you spend your money.
If you want to go with an intro APR credit card 0%, we have done much research on the cards are the best. Here are our favorites:
Best 0% Intro APR Credit Card: Citi Simplicity Card | Apply
The Citi Simplicity card offers one of the longest 0% intro APRs to 18 months, which also applies to balance transfers. A year and a half without interest. And the map also no late fees or annual fees . Better yet, Citi Simplicity Card does not charge late fees , so if you can not afford to make some payments after the first year, you will be ok.
Best Cash Back Card 0% Intro APR: Blue Cash Card from American Express Preferred® | Apply
If you want to make your holiday shopping without fear of paying a ton of interest on purchases, this is the card for you. Blue Cash Card from American Express preferred (a NextAdvisor seller) offers a 0% introductory APR for 15 months on purchases and balance transfers. It also earns users an amazing 6% cash back at supermarkets, 3% on gas and at department stores and 1% on everything else. Cardholders also receive a $ 150 bonus (acquired as a statement credit) after spending $ 1,000 in the first 3 months.
The best credit card Intro Bonus:
Barclay Arrival World MasterCard | Apply
Though 0% APR is an introductory bonus on their own, some cards offer a return extra cash bonus intro. Barclay Arrival World MasterCard offers not only a 0% Intro APR for 12 months, but you also get 20,000 points when you spend $ 1,000 in the first 90 days, which is $ 200 the card is pretty much just for you give. Redemption is simple you can just use the $ 200 to pay for any purchase of travel on your credit card statement. In addition, Barclays Global Arrival Mastercard gives 1x points on every purchase and another 10% bonus on all items you use to travel, so if you spend 10,000 points on travel, you get 1000 points back. It also has no annual fee.
The best credit card with no annual fee Chase Freedom | Apply
The Chase Freedom card offers 15 months 0% introductory APR on purchases and balance transfers, which is one of the periods of APR intro more we saw, especially for no annual fee card. It offers $ 150 cash back after spending $ 500 in first 3 months, which is a good advantage. In addition to this, he Chase Freedom card gives you 5% cash back when you shop at Amazon.com and other major retail stores, which is perfect for the holiday shopping season.