 |  | By David Stevens Personal Finance Correspondent Tuesday, 10 June 2008 |
HSBC 13 Month 0% Balance Transfer
Which credit cards offer a longer 0% balance transfer period?
Related Money News
See our other recent related news stories:
Why less is not more when it comes to credit cards
It goes against conventional wisdom, but if you're a responsible spender, you're seriously losing out by not stacking your wallet with a fistful of credit cards. Sarah Wray explains.
|
HIGH-street banking giant HSBC has boosted the balance transfer deal on its HSBC credit card up to 13 months at 0%, but don’t be fooled into taking advantage of its 3-month 0% purchase rate that runs alongside it.
The ramped up balance transfer period – where you can shift debts from other cards over the HSBC card and not pay any interest for 13 months – puts the HSBC card in the premier league of 0% balance transfer cards.
Longest balance transfer periods
Only a handful of cards offer 0% balance transfer periods of more than 13 months:
• Egg Credit Card – 0% until Sep 09 (plus additional 10 months spread over the following 2 years)
• Capital One Platinum – 0% until Sep 09
• Virgin Credit Card – 0% for 15 months
• Barclaycard OnePulse – 0% for 14 months (max £5000)
• Barclaycard Platinum – 0% for 14 months (max £5000)
Spending trap
However, HSBC has injected a nasty surprise into the cards in the form of a spending trap that could see careless customers trapped into paying unwanted interest for at least 10 months.
The trap is encapsulated in the form of a generous-sounding 0% interest on purchases made within the first 3 months.
If used without performing a balance transfer, this indeed offers interest free purchases for the first 3 months.
However, if you have made a balance transfer you will have to pay this off in full first before you can pay off any purchases you have made.
Since the 0% interest period for purchases is only 3 months, after that interest will be applied to the unpaid purchase amounts at the card’s 16.8% APR.
And there will be nothing you can do about it until your balance transfer is paid off in full first.
This is a common trick used by balance transfer credit cards.
Rule of thumb for balance transfers
Experts say a rule of thumb is that if the balance transfer period is longer than the introductory purchase rate, you should never spend on the card.
Only the Capital One Platinum credit card offers a 0% introductory purchase rate and a 0% balance transfer rate for the same period of time.
Low balance transfer fee
Where the HSBC credit card wins one over on the cards that offer a longer balance transfer deal is it’s slightly lower than usual 2.5% balance transfer fee.
The balance transfer fee is a small amount paid for the privilege of shifting your debt to the interest-free credit card.
Only the Virgin Atlantic White credit card and the GM Credit Card offer a lower balance transfer fee, at 2% each, but they also only 6 month and 5 month 0% balance transfer periods.
|
Credit Cards Home
