The best 18-month interest free credit card is the Wells Fargo Platinum card because it offers intro APRs of 0% for 18 months on purchases and 0% for 18 months on qualifying balance transfers. There’s a balance transfer fee of 3% intro for 120 days, then up to 5% (min $5), and the annual fee is $0.
Another good option is the U.S. Bank Visa® Platinum Card. It offers 0% for 20 billing cycles on purchases and 0% for 20 billing cycles on balance transfers. Its balance transfer fee is 3% (min $5). The annual fee is $0*.
In addition, some store credit cards offer interest-free periods of 18 months or more. But that’s typically deferred interest rather than true 0% interest. If you don’t pay by the time the intro period expires, you owe interest from the date of purchase at the regular APR.
Balance transfers don’t hurt your credit score directly, but transferring a balance can indirectly cause credit score damage. When you apply for a balance transfer credit card, it will generate a hard inquiry on your credit report, causing a slight dip in your credit score. If you transfer a balance to an existing credit card account, however, there is no hard inquiry and no credit score damage. A balance transfer could still result in high credit utilization, though, and even allow you to rack up more debt than you can afford, if you’re not careful. Both of those things can hurt your credit score.… read full answer
So, the act of transferring a balance itself won’t affect your credit, but it will indirectly alter several key components of your credit profile, from utilization to the age of your accounts. These changes might lower your score a bit in the short term. But over time, interest savings and the ability to pay off your debt faster should make transferring a balance a net positive for your credit score.
How Balance Transfers Can Help or Hurt Your Credit Score
Balance transfers can take up to three weeks, or be completed in just a few days, after you make a request or apply for a card. Transfers to new accounts may take longer than existing accounts. Continue making payments on your original account in the meantime to avoid hurting your credit score.
If you apply for a new balance transfer card, the resulting hard inquiry will likely cause a slight dip in your credit score for up to 12 months.
Adding a new balance transfer card will reduce the overall age of your accounts, which can have a slight negative impact on your score.
Keep an eye on how the transfer affects your account’s credit utilization. Making a transfer will usually add 3%-5% to your debt due to balance transfer fees. If your utilization is over 30% of your credit limit, that’s not good for your score.
If you leave your old credit card(s) open, adding a new card will reduce your utilization ratio across all accounts, assuming no additional spending. The utilization on the card you transferred the balance from will drop, and it will increase on the card you transferred the debt to.
Balance transfer cards often have 0% introductory APRs. This gives you the chance to pay off your balance faster, since the full amount of your payments will go to the principal rather than interest. This is good for your score long-term.
Balance transfers won’t hurt your credit by themselves. But they affect other elements of your credit that could bring your score down a little temporarily. Still, the benefits will outweigh the negatives in the long run, as long as you plan to repay most, if not all, of your balance during your card’s low introductory APR period.
Where people get into trouble is trying to use a balance transfer to support unsustainable spending habits, thinking 0% balance transfer credit card offers are always available. They’re not, and learning that the hard way is a very expensive mistake. So make sure to use a balance transfer calculator to make a payment plan.
A 0% APR means that you pay no interest on new purchases and/or balance transfers for a certain period of time. The best 0% APR credit cards give 15-18 months without interest. But the average 0% APR intro period is about 11 months for cards offering 0% purchases. And it’s around 13 months for the average card with 0% on transfers.… read full answer
A 0% APR does not keep you away from monthly payments, nor does it completely remove interest out of the equation. You still have to make monthly minimum payments to keep your 0% APR. And if you don’t pay off your balance by the end of the 0% intro period, you’ll have to pay interest on whatever balance remains. The penalty is even worse with many retailers’ 0% financing offers. If you don’t pay off your full balance in time, interest will retroactively apply to your entire original balance – as if the 0% APR was never there.
There are a few other things you should keep in mind when thinking about 0% APRs, too.
Here are some 0% APR key takeaways:
You pay no interest on your purchases and/or balance transfers for the duration of the introductory APR period, which depends on the card.
0% APRs make debt cheaper to pay off, which helps you get out of debt faster.
A 0% APR does not free you from the responsibility of making monthly payments. You must pay at least your monthly minimum to avoid being classified as late. Late payments damage your credit score.
0% credit cards tend to have fairly high regular APRs. So, you should strive to bring your balance to zero by the end of the 0% APR period, when regular rates take effect.
It’s also important to note that you won’t only find 0% APRs on credit cards. You may see auto loans with them, for example. Just be sure to always read the terms in detail before signing. You don’t want to end up with deferred interest instead of a true 0% APR.
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