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Moneyfacts issues credit card advice

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11/08/2008

At a time when every penny counts, Moneyfacts is urging consumers to shop around to make savings, rather than lining the pockets of credit card providers.

Michelle Slade, analyst at Moneyfacts, said: “As prices continue to rise, many more consumers are seeing their credit card bills increase. Even if you’re not one of the people who is having to use your credit card just to get by each month, the likelihood is that you have been hit by an increase of some sort from your card provider.

“If you now find yourself with a debt on your card and you want to cut down your monthly repayments, the best option is a balance transfer.

“The majority of the cards on the market come with a 0% balance transfer deal for a period of between three and 15 months. Alternatively, if you don’t want to keep switching cards and can’t pay off the debt during the term of the introductory deal a life of balance card may be more suitable.

“There are a couple of things to bear in mind when selecting a balance transfer card though. Unless you live in Northern Ireland, you will have to pay a balance transfer fee on 0% cards. This can be up to 3% of the amount of debt you transfer.

“You also shouldn’t use the card to make additional purchases. Most credit cards repay the cheapest debt first, meaning that any new debt will stay on the card longer, accruing interest.”

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