A general rule that should be followed when using any credit card is that the same card should not be used for both purchases and balance transfers.
Finding the best credit card can prove to be effective when making purchases or transferring balances, but these products must be approached with caution, it has been reported.
While most plastic products offer customers useful features such as 0% balance transfer and purchases, Jane Baker points out in a lovemoney.com article that those that attempt to use the card for both of its 0% features could face unexpected charges.
The damage that using one credit card for both making purchases and transferring a balance can be substantial, she claims, especially when considering the Virgin Credit Card.
Although the credit card offers a 0% balance transfer deal - the longest period available on the market - its interest-free period on purchases lasts for just three months.
And while the Virgin Credit Card sees borrowers receive discounts on goods and services bought from elsewhere within the Virgin Group after the 12-week offer is up, the lovemoney.com writer states that doing so could be to borrowers' detriment.
"If you keep spending on the card once the three months are up, taking advantage of all those juicy discounts, you'll fall into the negative payment hierarchy," Ms Baker said.
However, it could be possible for borrowers to avoid being hit by negative payment hierarchy should they opt for the Halifax All In One credit card. This, she states, is because the product offers a nine-month 0% deal on both purchases and balance transfers.
She points out that consumers should look to ensure all debts owed are paid off by the time the offer expires, otherwise the typical interest rate of 15.9% will be apply.
People looking to apply for a credit card offering 0% on purchases should consider the Tesco Clubcard, which she points out offers 0% on spending for 12 months, with a minimum repayment amount required.
Another to voice praise for the Tesco Clubcard was fellow lovemoney.com writer Serena Cowdy who recently claimed that the 0% balance feature is “perfect for gradually paying back big expenses”.
