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"Drop in 0% balance transfer deals"

By admin | December 15th, 2008 | Balance Transfers

According to recent reports there has been a marked drop in the number of 0% balance transfer deals available on the market, with the global financial crisis also affecting the credit card market in terms of both affordability and products. Many people have turned to 0% balance transfer cards to cut back on the interest that they pay on their high interest credit cards, especially around the Christmas and New Year period when many end up running up high debts on their credit cards and need to find a way to save money on the interest.

The news comes as one lender, Capital One, withdrew its best buy 0% balance transfer card from the market. Although there are other similar offers still available the tighter credit conditions in play mean that consumers will find it increasingly difficult to find a suitable and affordable balance transfer deal for their needs.

In October of last year 82% of credit card lenders offered 0% balance transfer deals, but this has now fallen to 75%, reflecting the drop in the number of 0% deals available on the current credit card market.

One industry official said: ‘These figures should send a clear message to borrowers that the credit card merry-go-round is grinding to a halt. In the coming months, it’s going to become increasingly difficult to refinance your debt at 0% interest. This trend away from extended balance transfer periods underlies a shift in the industry which is increasingly cautious about the people it lends to and is far more interested in the profitability of its customers. A year ago there were dozens of cards with overall APRs of little more than 10%, but today the most competitive cards offer rates of 16% or more.’

Tags: 0% balance transfers

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