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0 balance transfer credit card

A 0 balance transfer credit card is a card where you don't pay any interest at all on balance transfers, for a particular period, sometimes a year. This can be used either to save money on existing loans, or to make a profit.

To use such a card to save money on existing loans, such as other credit cards, the balances from other loans is transferred to the new 0 interest card, and so no interest is payable for the initial period. That means that you can use all the repayments towards bringing down the balance, without having to pay anything towards interest.

The other way to use these cards is to make a profit. Yes, you can actually make money using these cards. To do this, you would use the available funds from the new card to pay into a bank account which pays high interest, and since the interest you are charged on the card is zero for a period, all the interest you receive is profit. Then you would pay off the balance on the card just before it starts charging interest, because the interest you pay on a card is usually more than the interest you could receive from an interest paying bank account.

It is even possible to use such a card for other forms of investment, such as stocks, shares, commodities, forex, or business capital. Of course, such things typically carry significantly more risk than a high interest bank account. Some people say that the first set of hardware which started the Google business was bought using a credit card, and it is known that the movie "Clerks" was funded by cards.

Another important point is that cash advances from a card are often treated differently to either balance transfers or purchases, sometimes being charged a higher interest rate, sometimes being charged from the date they are obtained rather than the billing date, plus other details.

A 0 balance transfer credit card is a valuable asset if used wisely. Always carefully check the exact details which apply to the cards you use.