Whether you need to borrow or you've debt costing a fortune, credit cards are the best - and worst - remedy. Done badly they can lead to a world of pain - done right, they can save you £1,000s. Plus right now there are the best deals EVER to choose from. The longest 0% balance and money transfer cards, the longest 0% borrowing cards, and close to the longest combo cards.
Even if you've got good credit, it's vital to manage it and ensure you don't store problems for the future. So get a totally free Experian Credit Report as part of our Credit Club, which also gives your free Credit Score, Affordability Score, unique Hit Rate and eligibility chances for these & other cards.
Here are the top ones to look for - which all credit-check you - whatever your borrowing needs. And make sure you read the golden rules (in point 5), plus what 'up to' cards mean.
1. TOP 0% CARDS IF YOU'VE EXISTING DEBT. Do a 'balance transfer' and pay no interest for up to 43mths. Here, you get a new card that pays off existing debt on other credit and store cards, so you owe it instead, but at 0%, usually for a small fee. More of your repayments go to reducing the debt, so you clear it quicker - and you can shift debt from more than one card.
Important. Go for the card with the lowest fee within the time you know you can pay it back in. If in doubt, go long, even with a bigger fee.
- The best cards if you need 40mths+ to pay it off. This Halifax card (eligibility calc / apply*) is the joint-longest ever at up to 43mths 0%, with a 2.98% fee. Sainsbury's Bank (eligibility calc / apply*) offers 42mths 0% with a lower 2.3% fee, min £3. (Both are 18.9% rep APR after.)
- If you can pay a bit quicker, cut the fee and get cashback. This 32mth 0% HSBC card (eligibility calc / apply*) has a lower 1.4% fee (min £5) and offers £50 cashback on £1,500+ transfers till 11.59pm TODAY (Wed). So shift between £1,500 and £3,500 and you're in profit. Alternatively, Barclaycard (eligibility calc incl pre-approval / apply*) offers up to 32mths 0% for a 0.6% fee. It gives £20 cashback on £500+ transfers. (Both are 18.9% rep APR after.)
- If you can repay in less than 28mths, pay NO fee. This 28mths 0% Sainsbury's Bank card (eligibility calc / apply*) offers the longest-ever NO-FEE 0% debt shift though oddly, you do pay a 1.5% fee that's then refunded within 60 days (18.9% rep APR after). But after factoring in cashback, the cards above may be better.
You must usually do the balance transfer within 60/90 days to get the 0% + cashback. For full info and more options see Best Balance Transfers (APR Examples).
2. TOP 0% CARDS IF YOU NEED TO BORROW. Get 30mths' NO interest, NO cost with a 0% 'spending' card. This is THE cheapest way to borrow if done right, as if accepted you pay no interest for up to 30mths. As borrowing can be dangerous only do it for a planned, budgeted-for purchase, eg, a sofa or cooker. It's not an excuse to overspend.
Both The AA (eligibility calc / apply*) and Halifax (eligibility calc / apply*) offer up to 30mths 0%, while Sainsbury's Bank (eligibility calc / apply*) offers 29mths 0%. With the latter, if you shop at Sainsbury's you get 5,000 Nectar pts (worth £25) if you use it there 4+ times in month one. (All are 18.9% rep APR after.)
For full info and more options see Top 0% Cards (APR Examples).
3. TOP 0% CARDS THAT PAY CASH INTO YOUR BANK - TO PAY OFF AN OVERDRAFT OR A LOAN. Get a 'money transfer' card and pay NO interest for up to 41 months. This is a little-known feature of a small number of cards. You get money to clear an overdraft or a bank loan that you're paying interest on, so you owe the card instead but at 0%, for a small fee.
WARNING. This is complicated, so you must do it right. NEVER withdraw the cash, but ask the new card firm to transfer it to your current account. While other cards might offer this, they'll often charge heftier fees. See our Money Transfers guide for full info.
Virgin Money (eligibility calc incl pre-approval / apply*) offers 41mths at 0%, though has a high 3.8% fee to transfer (20.9% rep APR after). Another Virgin Money card (eligibility calc incl pre-approval / apply*) card has a shorter 36mths 0% period, yet has a lower 2.9% fee (20.9% rep APR after).
For full info and more options see Top 0% Money Transfers (APR Examples).
4. TOP 'ALL-ROUNDER' CARDS IF YOU NEED TO BORROW AND TO CUT EXISTING DEBT. These give up to 29 months 0% for new spending and balance transfers. If you've existing card debt AND want to borrow for a planned purchase, an all-rounder may be best. While each element isn't as hot as the deals above, they're all decent and you only make one application, so there's a smaller hit on your credit file.
MBNA (eligibility calc incl pre-approval / apply*) offers up to 29mths 0% on purchases and balance transfers, though has a hefty 2.95% transfer fee. Nuba (eligibility calc incl pre-approval / apply*) offers one month fewer, at up to 28mths 0%, with the same 2.95% transfer fee. Shift £1,000+ within 60 days and you get a £20 Amazon gift card.
Virgin Money (eligibility calc incl pre-approval / apply*) offers 25mths 0%, and has a lower 1.5% transfer fee. After the 0%, all charge 18.9% rep APR on purchases balances and 20.9% on balance transfer debt.
For full info and more options see Top All-Rounder Cards (APR Examples).
5. Credit Card Golden Rules. Always follow these key points to ensure you don't lose out.
- Only use the card for its intended purpose. Eg, never make purchases with a balance transfer card, and don't do a balance transfer on a purchases card.
- Never miss a min monthly repayment (it's best to pay by direct debit) or bust your limit or you could lose the 0% deal.
- Plan to clear the card before the 0% ends or the rate jumps to the rep APR.
- Don't withdraw cash on these - it's rarely at the cheap rate.
6. Some have an 'up to' length so you may get a shorter deal even if accepted. Use our eligibility calculator to assess your chances of getting a card. If you only see 'up to' cards you're less likely to get the full length.
7. Do you really NEED to borrow? If you're just funding an ongoing lifestyle, this is the worst type of borrowing, as it means you're living beyond your means and risk a debt spiral. Do a money makeover, stop spending and cut your cloth accordingly.
8. Can't sleep because of debt? This isn't for you. Forget the above and get free, one-on-one debt-counselling help from Citizens Advice, CAP, StepChange or National Debtline. They are there to help, not judge. The most common thing we hear after is: "I finally got a good night's sleep". Read inspiring stories in our Debt-Free Wannabe forum board and see our Mental Health & Debt guide. Full info: Debt Crisis Help.
This article first appeared in the weekly email on 29 March 2017.