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The 0% credit card most people can get
Capital One launches interest-free balance transfer card for those with 'average' credit.
Capital One launches interest-free balance transfer card for those with 'average' credit
Interest-free balance transfer credit cards are a great way to clear debt cheaply. The problem is that they can be difficult to qualify for if you don't have a spotless credit rating.
In response to this, Capital One has launched a card that is available to people with an 'average' credit history.
It's called the Capital One Balance Card Visa card, which allows you to avoid interest on your debt until April 2013 and comes with a reasonable 3% balance transfer fee.
Now, it's worth stressing that you can get far better deals elsewhere - Barclaycard is offering 23 months' interest free with a fee of 2.8%, for example - but they all require a spotless credit rating.
The key selling point of this new Capital One card is that it gives a far greater number of people access to a 0% balance transfer deal, and with average credit card interest rates nearing 20%, that can only be a good thing.
So, who can get it?
Capital One says you probably won’t get the card if:
- You’ve never had credit in the UK before
- You’ve been declared bankrupt in the last 12 months
- You’ve had any County Court Judgements (CCJs) or defaults in the past 12 months
However, if you have a CCJ that happened over a year ago, you have a much better chance of getting one of these cards. You just need to show that you’ve turned over a new leaf since your CCJ, you’re successfully paying your bills on time and generally managing your debt in a sensible manner.
It will also help your application if you’re on the electoral roll. In other words, you’ll be able to get this card if you have an average score, but not one that is horrendously bad.
Not the best
This is great news because the Capital One card will basically give you a seven-month 0% period when you won’t have to pay any interest on your credit card debt.
That said, the Capital One card isn’t the best 0% card on the market. In fact, it’s nowhere near the best. So let’s see how this card compares with the top cards on the market:
Top 0% balance transfer cards
| Credit card | 0% period | Balance transfer fee | Fee paid on £2,000 transfer | Normal APR | Notes |
| Barclaycard 23 Mth Platinum Visa | 23 months | 2.8% | £56 | 17.9% | |
| HSBC Visa | 23 months | 3.3% | £66 | 17.9% | HSBC current account customers only |
| Barclaycard 22 Mth Platinum Visa | 22 months | 2.6% | £52 | 17.9% | |
| Tesco Clubcard for Balance Transfers | 22 months | 2.9% | £58 | 16.9% | One clubcard for every £4 spent on card |
| Natwest Platinum | 22 months | 3.2% | £64 | 17.9% | |
| Halifax 22 Mth MasterCard | 22 months | 3.5% | £70 | 17.9% | |
| MBNA Platinum Credit card | 20 months | 2.85% | £57 | 16.9% | |
| Halifax 20 Mth MasterCard | 20 months | 3% | £60 | 16.9% | |
| first direct gold card | 20 months | 2.9% | £58 | 16.9% | |
| Nationwide Visa | 20 months | 3.1% | £62 | 15.9% | |
| Lloyds TSB Platinum MasterCard | 15 months | 1.5% | £30 | 17.9% | 50% refund on balance transfers over £1500 before 16th Nov. |
| Fluid card | 15 months | 1.5% | £30 | 15.9% | |
| Barclaycard Lowest Balance Transfer Fee | 12 months | 1% | £20 | 19.9% | Initial 1.2% fee is charged, followed by 0.2% refund. |
| Barclaycard Gold Visa | 9 months | 2.5% | £50 | 19.9% | Suitable for strengthening credit rating |
| Capital One Balance Card Visa | Until 30th April 2013 | 3% | £60 | 34.9% | For people with average to good credit history |
As you can see there are plenty of cards that offer longer 0% periods than the Capital One card, and several also have lower balance transfer fees. In many ways, the Capital One card is the worst card in the table.
But because people with average credit ratings won’t be able to get the best 0% cards, the Capital One card is a welcome addition to the market and will work well for some folk.
In fact, there’s only one other attractive 0% card aiming at the ‘average credit rating’ market. That’s the Barclaycard Gold Visa card. It offers a nine-month interest-free period with a 2.5% fee. Those are better terms than for the Capital One card, but if your existing debt is already on a Barclaycard, you’ll have to go for the Capital One card.
Credit rating
I imagine that some readers won’t be sure whether they have a spotless credit rating or just an average one. If that’s the case you could get a free credit report from Experian and find out what the banks think about you as a potential borrower.
You could also apply for a top credit card and see if you get turned down or not. It’s ok to apply for one top card, but if you get refused by one, don’t start applying to several card providers. That’s because multiple applications for cards can damage your credit score – the banks will think you’re desperate for cash and mark you down as a result.
But if you apply for one top card, get turned down, and then apply for either the Capital One card or the Barclaycard Gold, your rating shouldn’t be seriously affected.
Hopefully, you’ll be able to get one of those two cards, and then you can really focus on paying down your credit card debt.
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6Comments
01/10/2012 10:31
Instead of all these crazy offers to further keep people debt enslaved, the Government should initiate a Regulatory Body to oversee the operation of ALL Credit card companies and instruct them to charge a maximum of up to ten times the Base Rate or even 7 to 8% instead of the useurous rates they demand. This would occasion hope for the millions of people trying desperately to extract themselves form the claws of these unscrupolous money lenders. It would also eventually feed money back into the economic system of retailers etc benefitting the economy as a whole, as people extracted themselves from expensive debt servicing.
However Governments and even the EU are in the pockets of these powerful Western Oligarchs, who lobby hard to maintain their stranglehold on everyones incomes
You never know, some Political Party might just put this in their Manefesto and then lets see how the millions of struggling people go along with the idea ?
How about a 100,000 request for the matter to be debated in Parliament ?
By the People, For the people Of the people. Lets get back to a realistic Lifestyle !
01/10/2012 12:08
How's this for a novel way of approaching debt... Don't spend what you can't afford? People blindly get a card, then another and another and then when they can't make ends meet expect the card company or the state or anyone who will listen to them to 'excuse' their spending because "it is not fair" blah, blah blah.
Pull your horns in, pay off the debt and stop whining.
01/10/2012 14:53
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ou could also apply for a top credit card and see if you get turned down or not. It’s ok to apply for one top card, but if you get refused by one, don’t start applying to several card providers. That’s because multiple applications for cards can damage your credit
01/10/2012 17:14
01/10/2012 15:40
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