An APR or the Annual Percentage Rate is the combination of monthly finance charges and interest rates expressed annually. Every credit card has different APRs. For example there is a certain rate of APR for purchases, cash advances and balance transfers. The cash advances have the highest APR compared to credit purchases and balance transfers. Balance transfers carry the lowest rates usually. The zero percent APR normally applies to balance transfers and promotional credit cards like the students credit card.



The Zero APR is prevalent for a specific introductory period which lasts for six months or a year. Lets evaluate what exactly the 0% APR really man? Let's say you have a high interest rate balance outstanding on an existing credit card. You have also used most of the credit. The zero percent APR credit card gives you the benefit to transfer your balance onto this card without any additional interest to be paid. The zero percent interest rate is usually there for the promotional period. It reverts to the higher rate at the end of the promotional period.

People are enamored by the fact that they do not have to pay an interest for the time being and also that the APR is delayed on the account. The 0% APR is a good deal if you make a significant purchase and make the payment before the introductory period is over. Read the credit card documentation and fine print to understand the exact definition of ‘introductory period'. Mostly the first purchase triggers off the start of the zero percent interest credit balance rather than the beginning of the first billing cycle. Also find out if you lose your right to avail of a zero percent APR if you make or do not make certain purchases or refrain from making payments within a certain time.

You have to also ascertain what the APR of the credit card will stand at after the introductory period is over. If the interest rate is going to be higher than the APR of other credit cards that do not offer zero percent APR in the first place, and you are not going to make the most use of the zero percent APR, then the former card is not of much use. You can always do with the card with a low interest rate as more useful in the long run. Invest your time in research online and get in touch with experts in the field of credit cards, who can take a stock of your spending habits and find out if a credit card with a zero percent APR can really suit your needs.