Credit Card Shuffling

Credit card shuffling allows you to lower the cost of your credit card by transferring your balance to another credit card. Typically, you get a 0 percent interest charge on your current balance to save up to 70 percent of your total debt. However, the 0 percent interest charge may be offered for a period of six or twelve months, or the balance transfer may include a fixed interest rate on the transfer amount. In any case, balance transfer from one credit card to another may save you money in the long run.

What to consider before applying for credit card shuffling

There are certain factors that could adversely affect your application for balance transfer. For instance, if you don't have an account in good standing, you are less likely to be approved for credit card shuffling. Also, keep in mind that balance transfer may impact your interest and credit score, if you go above 25 percent of your maximum credit limit.

The following steps will help you shuffle your credit card debt effectively.

List your debt

The most important step is to list your debt so that you know what is the exact amount you need to transfer to a new credit card and how you can manage the interest rate charges. Write down balances, interest rates and minimum payments to avoid being charged with extra fees or transfer your balance to a higher interest card.

Avoid late payments

Make sure to make timely payments, above minimum because late credit card payments incur additional fees and they also initiate the retroactive elimination of the grace period. This means that by the moment you are making a purchase until the day that your creditor receives the payment you are charged with fees for the product or good purchased. In some cases, creditors may move the due date at an earlier date without notice or charge you with extra fees even if you pay on the due date.

Set up automatic payments

Set up an automatic payment to make sure that your payment will reach your creditor on due date, thus avoiding extra fees and interest charges. You may even ask your creditor to change the due date so that you adjust your payment schedule based on the dates you receive your pay check.

Ask for a lower interest rate on each credit card

Ask each creditor to lower the interest rate charged on current balance. Chances are, some creditors will immediately proceed with lowering the rate in order to keep you in their customer base. Others may collect information on your current financial situation to determine of your financial difficulties justify a lower interest rate.

Check out your credit score

Your credit score assists your lenders to determine if you qualify to acquire a new line of credit or to negotiate lower interest rates on a loan. Your credit score is affected by your payment history, the total balance on your credit bill, the length of credit history, and potential bankruptcies and defaults on your debt. If you have a bad credit rating, your borrowing options will be significantly limited because the lower your credit score, the higher the risk your creditor undertakes by lending you money. To avoid being rejected due to low credit rating, you can check your credit score through two main credit agencies, Experian and Equifax.

Shopping around for the best rates

Before shopping around for a credit card, it is important to determine your credit needs to ensure that using a credit card will minimize the interest charges. There are several websites where you can look for the best credit card deals. MoneySupermarket, USwitch, Halifax, and UkCreditCards provide abundant information about a wide selection of credit cards that can meet your credit needs. Are you looking for credit building? Do you need cash back for spending? Do you need 0% interest rate on new purchases? There are all sorts of deals out there, but you have to make sure you choose the one that fits your personal needs. Keep in mind that credit cards, typically, come with hidden charges. These may include charges for late payment, charges for exceeding your credit limit, cash withdrawal fees, returned payment fees for bounced checks or fees for using your credit card abroad.

In conclusion, before shuffling your credit card debt make sure you know what you're looking for. Do your research, see what different creditors offer and if the suggested credit card deals match your individual needs. Consider all the interest charges and how these could affect your existing credit balance and credit score before transferring your balance to a new credit card with a potentially higher rate. Your goal with credit card shuffling is to lower your debt and improve your financial situation.

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