Zero. In many contexts, that sounds pretty great. Free stuff is what’s mostly associated with the number. That’s why it’s quite understandable that zero percent balance-transfer credit cards can seem so enticing. These offers allow you to move a balance from a credit card that charges interest to a card that doesn’t. Not a bad deal, right? Sure seems that way. But before leaping at an offer, read the fine print and calculate the costs like the rate offered as well as transfer fees or minimum loyalty payments. Here’s a good place to start.

Introducing…

Introductory interest rates are generally incentivized through a low percentage rate. These appeal to many people because they are significantly discounted when compared to standard offers. Research any penalties related to late payments as well. That’s because introductory rates may only apply if you pay on time. Don’t let fine print like that hurt you after switching cards. So do your homework and plan ahead.

Timing is Everything

The length of the introductory period – the duration the introductory interest rate is offered – is also key to finding which card is right for you. They typically range from a minimum of 6 months to sometimes as long as 2 years. If you are trying to eliminate debt from a previous credit card, consider how long the offer lasts when assessing its pros and cons.

After the Honeymoon

No matter how attractive an introductory rate appears, be sure and find out the Annual Percentage Rate (APR) to determine if it’s worth it. That number matters because if it’s high, it could negate the introductory rate’s initial appeal.

Transfer Fee

Factor in the card’s balance transfer fee before you switch too. Standard fees are around 3%. The good news is that the balance transfer fee can be negotiable. Although that’s not always the case, it’s smart to find out.

Bare Minimum

The minimum loyalty payment is another important indicator of a balance transfer credit card. This will give you a good idea of what the card requires in the long run.

What are your perceptions of balance transfer credit cards? The good and yes, the bad. Tell us in the comment section below.