One of the most popular ways of doing this is to shift your credit card debt to an interest-free balance transfer card.
This can slash your annual percentage rate (APR) from a typical 18.9 per cent to zero, giving you breathing space to clear the debt.
The MoneyComms.co.uk personal finance expert Andrew Hagger said January is a bumper month for balance transfers, with more than half a million people switching, fuelling a credit card price war.
“Barclaycard, nuba and Sainsbury’s Bank have all entered the fray now, offering interest-free balance transfers for an incredible 42 months. That’s three-and-a-half years.”
MBNA has now pipped all three with a deal lasting 43 months.
“This is the longest duration ever offered in the history of UK credit cards,” Hagger added.
He said business has become so cut-throat that Barclaycard and MBNA offer £20 switching incentives, while nuba gives you a £20 Amazon gift card.
You will have to pay a small transfer fee, which can vary according to the issuer.
Barclaycard charges 2.99 per cent of your balance, MBNA and nuba charge 3.29 per cent and Sainsbury’s Bank charges 3.5 per cent, which would cost £35 for each £1,000 transfer.
Bot the charges will be more than covered by the savings.
Charlotte Nelson, finance expert at MoneyFacts.co.uk, said avoid using the cards for new purchases, as you will pay APRs of 18.9 per cent.
“Clear your balance before the deal expires, otherwise you will start paying interest,” she said.
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