The Wall Street Journal discussed news of another credit card industry ploy: 0% financing for life on balance transfers. Aimed at stopping people from moving their balances from card to card, chasing short-term low interest teaser rates, two issuers, Discover Card and J.P. Morgan Chase, are offering the 0% deals.
However, these issuers have not suddenly developed a philanthropic streak. The fine print is full of land mines. The Discover Platinum card, for example, charges nearly 20% interest for missing a single minimum payment and then cancels the 0% deal. For someone keeping a $20,000 balance that could add up to $4,000 a year in finance charges. Some of the deals also require customers to have at least two new transactions per month, for which they are charged standard credit card rates. The new charges stay on the books incurring interest until the transferred balances are paid off.
Editor’s View: This is the credit card industry’s version of a great deal: great for the credit card companies, lousy for anyone taking them up on their offer. All together now: “If it sounds too good to be true…..