The truth about the credit card traps behind eye-catching offers

They are promoted as the best way to clear debts, but nearly half of all balance transfers made on credit cards, a whopping 49 per cent, are not repaid by the end of the 0 per cent interest window. Most borrowers take an extra five-and-a-half months once the interest-free offer ends to clear the remaining debt, setting them back £104 interest, a report says. Typically, borrowers shift a negative balance of £1,855 to credit card providers offering 0 per cent interest deals, according to lend-to-save provider, Zopa. These deals last on average 14 months. But not paying them off in time is costing cardholders a grand total of £443 million in fees.

The credit card conundrum

The average borrower has £9,513 of unsecured debt, Zopa said, with credit cards making up the largest proportion of that - around one third. Despite this, 42 per cent of people said they 'never' or 'rarely think' about the money they owe the bank. Credit cards promising interest-free solutions are constantly appearing in the market. Barclaycard, for example, recently unveiled a 32-month interest-free balance transfer card, which means those who can get the card have almost three years to pay off what they owe without making the situation worse by adding interest on top.
A deal like this sounds too good to be true. For those who pay it off within the interest-free period it really is a great deal - even once you take fees for transferring a balance into account......Read more here