Introduction
A credit card 0 APR (annual percentage rate) is a special offer that some credit card companies provide to attract new customers or retain existing ones. It means that you don’t have to pay any interest on your purchases or balance transfers for a certain period of time, usually between 6 and 21 months. This can be a great way to save money on interest charges, pay off debt faster, or finance a large purchase without paying extra fees.
However, not all credit card 0 APR offers are created equal. There are some things you need to know before you apply for one, such as:
- How long does the 0 APR period last and what happens after it ends
- What transactions qualify for the 0 APR offer and what transactions don’t
- What fees and penalties you may incur if you miss a payment or exceed your credit limit
- How the 0 APR offer affects your credit score and your ability to get other credit cards or loans in the future
In this article, we will answer these questions and more, and give you some tips on how to make the most of a credit card 0 APR offer. We will also compare some of the best credit card 0 APR offers available in Canada, and show you how to apply for them online.
| Topic | Summary |
|---|---|
| What is a credit card 0 APR? | A promotional offer that allows you to pay no interest on your purchases or balance transfers for a limited time |
| How to choose the best credit card 0 APR offer? | Compare the length of the 0 APR period, the type of transaction, the fees and penalties, and the credit score requirement |
| How to apply for a credit card 0 APR offer online? | Compare different offers, check your eligibility, and submit your application online |
| How to use a credit card 0 APR offer wisely? | Make a plan, stick to your budget, pay on time, and transfer or pay off your balance before the period ends |
| What are some of the best credit card 0 APR offers in Canada? | Credit Card 0 Interest Canada, Credit Card Instant Approval Canada, Credit Card MBNA |
What is a Credit Card 0 APR?
A credit card 0 APR is a promotional offer that allows you to pay no interest on your purchases or balance transfers for a limited time. The length of the 0 APR period varies depending on the card issuer and the type of transaction. For example, some cards may offer 0 APR on purchases for 12 months, while others may offer 0 APR on balance transfers for 18 months.
The main benefit of a credit card 0 APR is that you can save money on interest charges, which can add up quickly if you carry a balance from month to month. For instance, if you have a $5,000 balance on a card with a 19.99% APR, you would pay $999.50 in interest in one year. But if you transfer that balance to a card with a 0 APR offer for 12 months, you would pay no interest at all, saving you almost $1,000.
Another benefit of a credit card 0 APR is that you can pay off your debt faster since all your payments go towards reducing your principal balance, not paying interest. For example, if you have a $5,000 balance on a card with a 19.99% APR and you pay $250 per month, it would take you 26 months to pay it off in full. But if you transfer that balance to a card with a 0 APR offer for 18 months and pay the same amount, you would pay it off in only 20 months.
A third benefit of a credit card 0 APR is that you can finance a large purchase without paying extra fees. For example, if you want to buy a new laptop for $2,000 and you have a card with a 19.99% APR, you would pay $399.80 in interest if you pay it off in 12 monthly installments of $199.98. But if you use a card with a 0 APR offer for 12 months and pay the same amount, you would pay no interest at all, saving you almost $400.
How to Choose the Best Credit Card 0 APR Offer
Not all credit card 0 APR offers are the same. Some may have longer or shorter periods, higher or lower fees, or different eligibility criteria. Here are some factors to consider when choosing the best credit card 0 APR offer for your needs:
- The length of the 0 APR period: The longer the period, the more time you have to pay off your balance without paying interest. However, keep in mind that the regular interest rate will apply after the period ends, so make sure you can pay off your balance in full by then or transfer it to another low-interest card.
- The type of transaction: Some cards may offer 0 APR on purchases only, while others may offer it on balance transfers only or both. Depending on your situation, you may want to choose a card that matches your needs. For example, if you want to consolidate your debt from other high-interest cards, look for a card that offers 0 APR on balance transfers. If you want to make a large purchase and pay it off over time, look for a card that offers 0 APR on purchases.
- The fees and penalties: Some cards may charge fees for balance transfers or annual fees for using the card. These fees can reduce the amount of money you save with the 0 APR offer, so compare them carefully before applying. Also, be aware that some cards may cancel your 0 APR offer or charge penalty interest rates if you miss a payment or exceed your credit limit, so make sure you pay on time and stay within your budget.
- The credit score requirement: Some cards may have higher or lower credit score requirements for approval. Generally, the higher your credit score, the more likely you are to qualify for a 0 APR offer and get a lower regular interest rate after the period ends. However, some cards may be more lenient or flexible than others, so check the eligibility criteria before applying.
| Card Name | 0 APR Period | 0 APR Transactions | Balance Transfer Fee | Annual Fee |
|---|---|---|---|---|
| MBNA True Line Mastercard | 12 months | Balance transfers | 3% | $0 |
| Scotiabank Value Visa Card | 6 months | Balance transfers and cash advances | 1% | $29 (waived in the first year) |
| CIBC Select Visa Card | 10 months | Balance transfers | 1% | $29 |
| Tangerine Money-Back Credit Card | 6 months | Balance transfers | 1.95% | $0 |
| BMO Preferred Rate Mastercard | 9 months | Balance transfers and cash advances | 0.99% | $20 |
How to Apply for a Credit Card 0 APR Offer Online
Applying for a credit card 0 APR offer online is easy and convenient. You can compare different offers from various card issuers, check your eligibility, and submit your application in minutes. Here are the steps to follow:
- Compare different credit card 0 APR offers: You can use a website like SafexBudget to compare different credit card 0 APR offers available in Canada. You can filter the results by the length of the 0 APR period, the type of transaction, the fees and penalties, and the credit score requirement. You can also read reviews and ratings from other users to get an idea of their experiences with the cards.
- Check your eligibility: Once you find a credit card 0 APR offer that suits your needs, you can check your eligibility by clicking on the “Apply Now” button. You will be redirected to the card issuer’s website, where you will have to provide some personal and financial information, such as your name, address, income, employment status, and existing debts. You will also have to consent to a credit check, which may affect your credit score temporarily.
- Submit your application: After filling out the application form and reviewing the terms and conditions, you can submit your application online. You will receive an instant decision or a notification that your application is being processed. If you are approved, you will receive your new credit card in the mail within a few weeks. You can then activate it and start using it for your purchases or balance transfers.
How to Use a Credit Card 0 APR Offer Wisely
A credit card 0 APR offer can be a great tool to save money on interest charges, pay off debt faster, or finance a large purchase without paying extra fees. However, it can also be a trap if you don’t use it wisely. Here are some tips on how to use a credit card 0 APR offer responsibly:
- Make a plan: Before you use your new credit card for purchases or balance transfers, make a plan on how you will pay off your balance in full by the end of the 0 APR period. Divide your balance by the number of months in the period and set that amount as your monthly payment goal. For example, if you have a $5,000 balance and a 12-month 0 APR period, aim to pay $416.67 per month. You can also use a credit card payoff calculator to see how much you need to pay each month and how much interest you will save.
- Stick to your budget: Don’t use your new credit card as an excuse to spend more than you can afford. Remember that you still have to pay back what you borrow, even if it’s interest-free for a while. Keep track of your spending and income, and avoid making unnecessary or impulse purchases. Also, avoid using other high-interest cards while you are paying off your 0 APR balance, as this will only increase your debt and interest charges.
- Pay on time: Paying on time is crucial to maintain your 0 APR offer and avoid fees and penalties. If you miss a payment or pay late, you may lose your 0 APR offer or incur penalty interest rates, which can be much higher than the regular rates. To avoid this, set up automatic payments from your bank account or set reminders on your phone or calendar. Also, pay more than the minimum amount whenever possible, as this will help you pay off your balance faster and save more money on interest.
- Transfer or pay off your balance before the period ends: Don’t wait until the last minute to transfer or pay off your balance before the 0 APR period ends. If you don’t do this, you will start paying interest on your remaining balance at the regular rate, which can be quite high depending on the card. To avoid this, transfer your balance to another low-interest card before the period ends or pay it off in full with cash or savings.
Frequently Asked Questions about Credit Card 0 APR Offers
Here are some common questions that people ask about credit card 0 APR offers:
- Q: Can I get more than one credit card 0 APR offer?
- A: Yes, you can get more than one credit card 0 APR offer if you qualify for them and have enough available credit. However, this may not be a good idea if you have trouble managing multiple payments or if applying for too many cards lowers your credit score. It may be better to focus on one or two cards with the longest 0 APR periods and the lowest fees.
- Q: Does a credit card 0 APR offer affect my credit score?
- A: A credit card 0 APR offer can affect your credit score in different ways, depending on how you use it. Applying for a new card may lower your score temporarily due to the credit check, but it may also increase your score over time by adding to your credit history and improving your credit utilization ratio (the amount of credit you use compared to the amount of credit you have available). However, if you miss payments, exceed your credit limit, or carry a high balance, you may hurt your score and damage your credit reputation.
- Q: What are some of the best credit card 0 APR offers in Canada?
- A: There are many credit card 0 APR offers in Canada, but some of the best ones are:
- Credit Card 0 Interest Canada: This card offers 0 APR on purchases for 12 months and 0 APR on balance transfers for 10 months, with no annual fee and no balance transfer fee. It also offers cash-back rewards on every purchase and a welcome bonus of $200.
- Credit Card Instant Approval Canada: This card offers 0 APR on purchases for 6 months and 0 APR on balance transfers for 15 months, with no annual fee and a low balance transfer fee of 1%. It also offers travel rewards on every purchase and a welcome bonus of 25,000 points.
- Credit Card MBNA: This card offers 0 APR on balance transfers for 12 months, with no annual fee and a low balance transfer fee of 3%. It also offers low-interest rates on purchases and cash advances, and a flexible rewards program that lets you redeem points for cash, travel, merchandise, or gift cards.
- Q: What are the benefits of a 0% APR credit card?
- A: A 0% APR credit card can help you save money on interest charges, pay off debt faster, or finance a large purchase without paying extra fees. By transferring your existing balances from other high-interest cards or making new purchases with a 0% APR card, you can avoid paying interest for a limited time, usually between 6 and 21 months. This can help you reduce your debt and improve your credit score.
- Q: What are the drawbacks of a 0% APR credit card?
- A: A 0% APR credit card can also have some drawbacks, such as fees, penalties, and credit score impact. Some cards may charge fees for balance transfers or annual fees for using the card. These fees can reduce the amount of money you save with the 0% APR offer, so compare them carefully before applying. Also, be aware that some cards may cancel your 0% APR offer or charge penalty interest rates if you miss a payment or exceed your credit limit, so make sure you pay on time and stay within your budget. Additionally, applying for a new card may lower your credit score temporarily due to the credit check, but it may also increase your score over time by adding to your credit history and improving your credit utilization ratio.
- Q: How do I qualify for a 0% APR credit card?
- A: To qualify for a 0% APR credit card, you typically need good or excellent credit (a score of at least 690 on the FICO scale) and a steady income. The higher your credit score, the more likely you are to qualify for a 0% APR offer and get a lower regular interest rate after the period ends. However, some cards may be more lenient or flexible than others, so check the eligibility criteria before applying. You can also improve your chances of getting approved by paying down your existing debt, paying your bills on time, and keeping your credit utilization ratio low.
Conclusion
A credit card 0 APR offer can be a great way to save money on interest charges, pay off debt faster, or finance a large purchase without paying extra fees. However, you need to be careful and responsible when using it, as it can also be a trap if you don’t pay on time or pay off your balance before the period ends. To make the most of a credit card 0 APR offer, you need to:
- Choose the best offer for your needs, based on the length of the period, the type of transaction, the fees and penalties, and the credit score requirement
- Apply online by comparing different offers, checking your eligibility, and submitting your application
- Use it wisely by making a plan, sticking to your budget, paying on time, and transferring or paying off your balance before the period ends
If you follow these tips, you can enjoy the benefits of a credit card 0 APR offer without falling into the pitfalls. For more information and advice on credit cards and personal finance, visit SafexBudget, your trusted online resource for budgeting and saving money.
