BALANCE TRANSFER RIDDLES

ABOVE: Credit card users have to be sure they can clear their balance in the allotted time

6th October 2009

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CREDIT card firms are changing their terms – so it’s vital you do the maths.

In the past year, the number of cards with no balance transfer fee has increased by 20%, but there are 25% fewer with 0% on transfers for at least 12 months.

And the length of 0% balance transfer deals is getting shorter. Pierre Williams, of website firm Moneyexpert.com said: “Users will have to consider if they can clear their balance in the allotted period.

“Paying a balance transfer fee can still be worth it if the card has a longer interest-free period.”

Someone with a £5,000 balance opting for a card with a 2.98% transfer fee and 0% on balance transfers for 16 months would have to pay about £312 a month to clear the balance.

Doing the same on a card with no transfer fee but a 12-month 0% period would mean monthly payments of £417.

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