0% interest credit card offers are back!
Several reports this week have called attention to the fact that major companies, who have shied away from 0% interest rate for offers over the last few years, are now beginning to revive such offers much sooner than expected.
As the credit crisis came into fruition just a few years ago, credit card companies found themselves swamped by bad debts. Risky behavior by borrowers such as overbuying on credit cards that offered 0% interest for a limited of time contributedpart of the fuel to the credit crisis fire.
Many consumers found themselves unable to pay back debts to credit card companies when it came time for low interest offers to expire. Additionally, as a sort of giant domino effect continued, unemployment and lowered incomes left many once qualified borrowers who borrowed based on 0% initial found themselves caught without a means to pay.
In order to protect themselves from further defaults on payments, credit card companies quickly began to discontinue offers that had a history of enticing lesser qualified buyers to rack up debts.
Credit industry experts speculated that such offers would entirely extinct going forward, but recent rollouts of several 0% offers have surprised them. In a recent interview with MSN, Curtis Arnold, founder of credit card comparison site CardRatings.com, noted that he never expected such offers to make as quick a comeback as they have.
Some of offers that have recently surfaced from major credit card companies include CitiBanks Platinum Select MasterCard which is now offering qualified applicants 0% for up to 21 months on balance transfers as well as 0% on purchases for 12 months with a fee of just 3%. Other offers include 0% on balance transfers and purchases with Capital One Platinum Prestige until September 2011, interests rates of 0% on balance transfers for 12 months with Discover More, as well as 0% on balance transfers with Chase Freedom.
Such impressive offers may work to win credit card companies new business, but some are left wondering if the enticing items contribute to more crises in the future? The new offers do come with new stipulations as well. Tight qualifying requirements have been set to protect consumers and avoid lending to those with bad credit. Even with new regulations, credit repair experts advise that consumers should always do their research on such offers and protect themselves and their credit by planning to pay off debts on low interest rate cards before being hit with insurmountable interest.
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Matt
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