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Two Reasons Credit Card Companies Send Balance Transfer Checks In The Mail

May 17, 2010 - 1:59 am

Many of us have received at least one balance transfer check in the mail, together with your monthly statement, and chances are the number has been extremely higher than that. Some companies tend to send out these offers at least once a month or even once a week. Most people in today’s society rely more on plastic, such as debit or credit cards, to make purchases rather than carry cash. A balance transfer is basically a type of debt consolidation because you’re transferring the balances from one or more accounts onto a single account. The purpose of this is to help people reduce their debts because they can focus on one payment every month instead of several payments scattered throughout the month. The credit card companies will try to convince you to use a balance transfer check to pay off higher interest credit cards. The transactions are simple and quick and before you know it, the balance has been changed from one card to another.

In many situations, this can be a great idea because your credit card company will guarantee you very low rates. When you consider that the average interest rate charged by a credit card company is around 16%, this is made even more appealing. The catch is that you have to be diligent about paying your monthly minimum payment on time. If you don’t comply, the interest rate will be increased to an even higher amount.

If you already have a credit card that that offered you a low introductory rate when you completed a credit card application online, and this offer is about to expire, you may find it of particular interest to transfer the balance. Or, if you have several credit cards with high interest rates, you can consolidate them all to one credit card, using the low balance transfer rates. This move will help to reduce the amount of total debt that you have as well as give you a lower interest rate. It can be difficult to pay off credit card balances when you are constantly being charged higher interest rates.

These offers are usually sent by mail together with your monthly credit card statement, as consumers are more likely to read it at the same time. Even if you fill out a credit card application online, the credit card companies will send you written correspondence by mail. They also mail these offers to people who are not even existing clients with the hope that they will switch over to their credit card company. Before you transfer your balances over, make sure to read over all terms and conditions so that you are not surprised by interest rate increases in the future.

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