If you’re thinking of becoming a credit card jumper, you need to be well informed. Here’s what you need about how credit card jumping can work for you.
What Is Credit Card Jumping?
Credit card jumping is the practice of moving debt from credit card to credit card to take advantage of low or nil interest rates.
Who Offers Low Credit Card Interest Rates?
Just about every credit card company offers low introductory interest rates to attract new customers. Some offer permanently low rates, which is good news for anyone who has a debt at a higher interest rate. Others offer 0% on purchases, which means consumers can spend as usual without paying any interest. Finally, many credit card companies offer 0% interest on balance transfers. This is very attractive for credit card jumpers.
How Do I Transfer My Balance To A 0% Card?
It’s simple. Just apply for a credit card as usual. Most credit card application have room for people to list the cards they want to transfer balances from and the amounts they want to transfer. In this case, the balances are transferred automatically when the account is opened. Other credit card companies allow customers to transfer balances after the account has been opened.
Are There Other Incentives For Getting A 0% Credit Card?
Most credit card companies offer other incentives to new cardholders. These include cardholder discounts on win, hotels or travel, travel insurance, money off vouchers and cash back offers. It is worth looking at the range of incentives before deciding on a card.
How Can I Be A Successful Credit Card Jumper?
To make a success of credit card jumping, there are two key things for consumers to do. The first is to make the required repayments on time. The second is to choose a new credit card and move the outstanding balance before the 0% interest rate expires.
What Are The Dangers Of Credit Card Jumping?
Credit card jumping only works if:
- People pay the required amount (the minimum repayment)
- People pay on time
- People move the money before the interest rate goes up.
Failure to do the first two could damage a person’s credit rating. This would make it more difficult for that person to get another credit card. Failure to move the money on time means that the credit card holder will have to pay interest. Since the point of credit card jumping is to reduce debt, this is not a sensible strategy.
It is also best to avoid putting additional spending on the card, as the interest on spending might be different from the balance transfer rate. It is best to check the fine print first.
Some credit card companies now apply a balance transfer fee so that they make some money from credit card jumpers. It is worth shopping around to find the few that don’t. Even with this fee, credit card jumping may be a useful strategy for people with a large debt.
The Delights And Dangers Of Credit Card Jumping
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