Another lengthy 0% balance transfer card has been launched, but how does it compare to those already on the market?
Fluid has launched a new 22-month 0% balance transfer card offering borrowers a break from hefty credit card interest payments.
The card has a fee of 2.89%, which you’ll pay on any money you move over, and a competitive interest rate of 16.9% once the balance transfer period ends.
In a highly competitive market, this card is a welcome addition. However there are longer and cheaper offers around.
The fee of 2.89% means if you were moving over £2,000 you would needs to pay a fee of £57.80. But if it’s a money transfer you’re interested in, which also has a 22-month 0% period, the fee to move the debt over is higher at 4% so you’ll need to factor this in before applying.
On top of the transfer deals, borrowers also have a three-month period of 0% interest on new purchases.
'Soft search' applications
Typically when you apply for credit the lender will look at your credit history before making a decision to accept you or not. This process leaves a 'footprint' on your credit record. So if you're rejected and then apply elsewhere, other lenders will be able to see that you've already applied unsuccessfully.
[SPOTLIGHT]The Fluid card is different because it allows you to apply without the risk of a black mark on your credit score if you’re rejected. Instead, the firm will give you an indication of how likely you are to be accepted via a 'soft search'.
However, you can only apply if you’re a new customer and as it’s issued by MBNA you won’t be able to move over money from an existing BMI, MBNA, Virgin or Fluid card.
The balance transfer market
The longest balance transfer cards on the market last for 27 months. Barclaycard, NatWest, RBS and Tesco all offer deals for this period.
Barclaycard is firmly in the top spot, with the lowest balance transfer fee of 2.99%, but all of these cards have higher interest rates than the latest Fluid deal.
There are also several providers offering cards at 26 months such as Barclaycard and Virgin Money, and Fluid also has a card in this range, with a fee of 2.89% and an APR of 18.9%.
Top five balance transfer cards
|
Card |
0% period |
Balance transfer fee |
Fee paid on £2,000 transfer |
Representative APR after 0% period ends |
|
27 months |
2.99% |
£59.80 |
18.9% |
|
|
27 months |
3.10% |
£62 |
18.9% |
|
|
27 months |
3.10% |
£62 |
18.9% |
|
|
27 months |
3.15% |
£63 |
16.9% |
|
|
26 months |
2.5% |
£50 |
18.9% |
How to use balance transfer cards
If you’ve built up a debt on your credit card and it has a high interest rate, it can be a struggle to get back into the black. A balance transfer card takes away the interest payments, for a set amount of time, and can therefore be a useful way to clear your debts.
However, they only work if you use them correctly and this means always paying your bill on time. If you fail to do this you could easily be fined, have the balance transfer period cut or even end up with a black mark on your credit score.