Low Introductory Rate Credit Cards

Written by Jessica Duquette
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Low introductory rate credit cards are fantastic for consumers looking to make large credit purchases while avoiding sizable finance charges. Having a low rate can dramatically decrease the interest charges paid over the life of the purchase and can ease the stress of high payments each month. Although the rate will increase after a certain time period, beginning with a low credit card rate can save hundreds or thousands of dollars.

Don't Fall For a Hook

There are many credit card companies that do not commonly offer low introductory rates because they know that they cannot keep those low rates and remain profitable. Instead of offering ridiculously low rates they may offer an average rate that will remain the same throughout the life of the account. If an offer with a low rate seems too good to be true it may be that the card company increases the rate significantly after a couple of months. Do your research and make sure that the rate inflation is not too large and you can afford the payments down the road.

The Advantage of Low Introductory Rate Credit Cards

Just because your new credit card may go through a couple of rate increases over the next couple of years does not mean you should immediately close it. If you do not carry high balances or intend to pay off purchases in a short period of time then a low rate will save you money. After your low introductory rate expires you may wish to look for another card as opening a new account may allow you to keep those low rates for a longer period of time.

Opening and closing new credit accounts allows you to have low introductory rate credit cards for years but it could also create problems. While your balances are usually low, having multiple accounts opened over a short period of time can have negative effects on your credit report. If your credit score is solid enough to endure some credit inquiries then changing cards is the way to go. If your credit history isn't the greatest then I would advise looking for a card with an average rate (11-15 percent) and sticking with that account. Although you may pay more in finance charges your credit score will improve if you make all your payments.

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