What is Credit Card Tarting?
Credit card tarts are credit card customers who try to keep the interest on all of their debts at a maximum rate of 0%. They do this by continuously switching deals between competing credit card providers. This process can save canny tarts hundreds of pounds, money that is charged as interest to other customers who don't switch their credit card providers as frequently.
Are 0% Interest Rates Always Available?
Tarting is tricky because 0% interest rates and 0% balance transfer rates are not always available. Tarting works best in periods of economic stability, because this is when credit card companies reduce restrictions on accounts to attract more customers. At these times credit card companies introduce very low interest rates and 0% interest rates. At other times, when economies aren't doing so well or are unstable, 0% deals may appear less frequently and credit cards are more likely to charge customers for transferring their debt from a competitor.
Tarts can have trouble when economic conditions start. Tarts that have amassed a large amount of credit, reach the end of the 0% interest rate on their current card and are then unable to find a new card with a 0% interest rate are forced to transfer to a card that does charge interest, and this can be expensive!
How to Tart
Prospective tarts should start by finding a card that offers 0% interest on purchases throughout the introductory period. Before this introductory period ends, if there is still a debt left unpaid, the tart should move this to a new card which offers 0% Balance Transfers. This transfer process can then continue to be used repeatedly until the tart can afford to pay their debt off in full.
If a tart reaches their maximum spend on one card, there is no reason why they cannot apply for for another 0% interest credit card at a different firm and continue to use this to spend.
Is There any Reason Not to Tart?Tarting is a very cheap way to borrow money but the process takes active management. Tarts need to be on the ball or risk accumulating interest at high levels, exactly what they don't want! If you leave a debt on a card, even for just a couple of months after the 0% period ends, you've defeated the whole point of Tarting.
If you are someone who is forgetful or careless with your finances you should not start tarting! Instead you should consider a less high risk strategy for credit, like getting a low cost loan.
It's also worth being aware that excessive tarting can have a major impact on Your Credit Score, so there are risks involved.
Tarts, Watch Out!
Credit card companies are smart. Make sure you ALWAYS read the small print before taking on any credit card, or any other financial product, otherwise you might find yourself caught out by a catch that could be very costly! For example, for some credit cards the 0% interest rate only applies to purchases, not to balance transfers. For others, the 0% rate may not apply to cash withdrawals. Also, should you spend over your credit limit or break another term of your contract your 0% interest rate is likely to be withdrawn. It pays to be careful when tarting!