A 0% APR credit card is offers an introductory 0% APR interest period on purchases, balance transfers or both. A break from finance charges can be a welcome change from the double-digit interest typically charged on credit cards. The less you’re paying in interest, the more you can put toward paying off your balance.
Chase Freedom Unlimited®
A good overall spending card that allows you to hold a balance on new purchases with a low introductory APR, pay no annual fee, and still earn at least 1.5% cashback on all purchases
- Generous welcome offer for a no annual fee card
- Unlimited 1.5% minimum earn rate for cash-back rewards
- No minimum redemption amount
- Foreign transaction fee
- Ongoing balance transfer fee is high
- Requires a companion card to transfer points to travel partners
- INTRO OFFER: Earn an additional 1.5% cash back on everything you buy (on up to $20,000 spent in the first year) – worth up to $300 cash back!
- Enjoy 6.5% cash back on travel purchased through Chase Travel, our premier rewards program that lets you redeem rewards for cash back, travel, gift cards and more; 4.5% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service, and 3% on all other purchases (on up to $20,000 spent in the first year).
- After your first year or $20,000 spent, enjoy 5% cash back on travel purchased through Chase Travel, 3% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service, and unlimited 1.5% cash back on all other purchases.
- No minimum to redeem for cash back. You can choose to receive a statement credit or direct deposit into most U.S. checking and savings accounts. Cash Back rewards do not expire as long as your account is open!
- Enjoy 0% Intro APR for 15 months from account opening on purchases and balance transfers, then a variable APR of 20.49% – 29.24%.
- No annual fee – You won’t have to pay an annual fee for all the great features that come with your Freedom Unlimited® card
- Keep tabs on your credit health, Chase Credit Journey helps you monitor your credit with free access to your latest score, alerts, and more.
- Member FDIC
What Does 0% APR Mean?
Spelled out, APR means annual percentage rate. In the context of a credit card, the APR is the same as the interest rate. “Zero percent APR” means no interest is being charged.
Typically, you’ll see the phrase “0% APR” or “0% intro APR” in reference to these kinds of cards These introductory financing offers provide new cardholders an opportunity to make payments on a balance over a specified period longer than a single billing period without accruing interest. Introductory APRs may apply to purchases, balance transfers or both, but when a 0% introductory APR ends, a regular APR applies and interest accrues.
Practically, this flexibility allows customers to finance new purchases or transferred debt from another card over a specified period without incurring interest charges. While 0% intro APR periods are useful financing tools, discipline is required because mismanagement of an intro period has the potential to cost consumers dearly. Always have a plan to pay off a balance in full before the end of a 0% intro APR period.
How Do 0% APR Credit Card Offers Work?
There are two types of 0% APR offers:
- Purchases. Use the card to make purchases and pay them off over the promotional period, interest-free.
- Balance transfers. Save on existing high-interest debt by transferring your balance to a 0% APR card.
Using a card with 0% APR on purchases is fairly straightforward. Just swipe your card as you normally would. Then, pay off the balance over time without incurring any finance charges for the life of the offer.
For example, make a $10,000 purchase on a card that has an introductory 12-month 0% APR purchase offer in purchases and you’ll have 12 months to pay it without piling on additional debt. But after the promo period ends, the card’s standard variable APR kicks in. This means if you’re still carrying a balance after the 12 month period, that balance will be subject to the card’s interest charges. Ideally, you’ll pay off the entire amount by the time the card’s 0% offer ends.
Making a balance transfer requires a few more steps. Often when you’re signing up for a card with a balance transfer offer, you’ll be asked during the application process if you want to transfer a balance. Otherwise, you can contact your card issuer to initiate the balance transfer. If the card charges a balance transfer fee, that can affect how much you’ll actually be able to transfer.
For example, if you’re approved for a $10,000 limit but the card charges a 5% balance transfer fee, you won’t be able to transfer the full amount. If you transfer $9,500, you’ll have to pay a $475 transfer fee, putting you just under your total credit limit. Keep in mind that just like a 0% offer on purchases, after the card’s promo period ends any remaining balance on the card will incur interest at the standard APR.
There are some cards that offer 0% APR on both purchases and balance transfers. If you’re transferring debt that you need extra time to pay off, it’s generally not a good idea to also make purchases on the card. You should know that some cards that offer 0% APR on both purchases and balance transfers have different offer periods for each. For example, a card could offer 18 months at 0% APR on balance transfers but only 6 months on purchases.
How Do I Qualify for a 0% Intro APR Offer?
As these kinds of credit cards are marketed toward consumers who might need the financial relief, the credit score issuers look for may vary. While some cards might want a fair or good credit score for approval, others may expect higher credit scores from the consumer. The application process is the same for any other credit card, but issuers may also offer preapproval or pre-qualifying tools so consumers can check if they qualify without hurting their credit score.
Card issuers are unlikely to drop your APR to 0% if you’re already a customer, but you may ask to lower your interest rate. Issuers may also offer 0% APR balance transfer deals to existing cardholders in the mail or through your online account.
Rarely do cards designed for bad credit offer 0% introductory APRs, so if you’re suffering from poor credit we’d advise building your credit first, then applying for better cards.
Beware credit cards offering deferred interest. While these may promise no interest and may sound much like a 0% intro APR, there’s a crucial difference—if you make a purchase on deferred interest and fail to pay it off in full during the promo period, you’ll be charged interest on the entire purchase amount from the date you made the purchase. By contrast, when a 0% intro APR ends, you’ll only be charged interest on any balance you’re carrying at that point.
A 0% APR Card Can Help You Shed Debt Faster
Think of a 0% APR offer like an interest-free loan with an expiration date. If used responsibly, it can give you a cushion of time to pay off what you owe, without accumulating additional finance charges.
Here’s how the math works. If you want to make a $5,000 purchase and your current card charges 18% interest, it will take you 11 months to pay off your card if you make a $500 payment every month. Plus, you’ll have paid an additional $457.83 in finance charges. If you use a card with an introductory 12-month 0% APR offer to make that same $5,000 purchase and you make $500 monthly payments, it will only take you ten months to pay off the balance without adding any finance charges.
If you want to pay down debt with the help of a balance transfer, keep in mind that many of the cards with the longest interest-free periods are likely to also charge a balance transfer fee—typically 3% to 5% of the amount transferred. This fee can eat away at the actual amount you’re able to save from a transfer. For example, if you’re looking to shift $10,000 worth of debt to a card with a 5% balance transfer fee, it will cost you $500 to do so.
To make the best choice for your particular circumstances, calculate if the cost of transferring your debt—including the balance transfer fee—is less than what you’ll pay in interest on your existing card. If you need more than two or three months to pay off your debt, a balance transfer is likely to be a less expensive option.
There are a handful of cards that don’t charge a balance transfer fee, like the Navy Federal Credit Union Platinum Credit Card. These cards may be a better choice as long as you can pay off your debt before the interest-free period ends. But if you’re seeking the longest runway possible to tackle your debt, it may be worth it to you to pay the transfer charge on a card with a longer 0% APR period.
Balance Transfer Fees May Apply, But They May Be Worth It
If you are considering a balance transfer card, make sure to account for any balance transfer fees when deciding if it’s a fit for your particular circumstances.
Here’s an example of how to calculate if a specific balance transfer offer is worth it for you. Say you are carrying $10,000 in debt on a card that has an APR of 20%. If you pay $1,000 per month toward that balance, you would need a year to pay it off and you’ll be charged an additional $1,030.20 in finance charges.
If you transfer that same $10,000 to a card offering 0% APR for 12 months with a 3% balance transfer fee, the balance transfer fee will add $300 to your debt. If you make payments of $1,000 per month, you’ll need 11 months to pay off your balance. Even after considering the balance transfer fee, you’ll have paid $730.20 less than if you had left it on the card with 20% APR.
If instead, you transfer that same $10,000 balance to a card with a 0% APR for 21 months with a 5% balance transfer fee, you’ll pay a $500 fee to transfer your balance. Since you have 21 months with 0% interest, you can make payments of only $500 per month and still have the card paid off before the no-interest period is over. Making the same $500 payments on the card with 20% APR, it would take you 25 months to pay off your debt and you’d incur $2,266.07 in interest charges. The 0% APR offer here would save you $1,765.04, after accounting for the balance transfer fee.
Zero Won’t Last Forever
When a credit card dangles an enticing opportunity to get a break on interest, it’s always for a limited period. Even the best 0% APR offers are only extended for a specific length of time—typically anywhere from six months to nearly two years—before your card will revert to the regular variable APR.
Make a plan to pay off as much as you can—ideally, all of your balance—before the promotional period expires. Note the date your offer ends so you’re not surprised when your bill arrives after that blissful interest-free time.
Don’t Expect Rewards on a 0% Transfer Offer
Although there are cards that offer rewards and 0% APR, it’s unlikely you’ll find a card that will let you earn rewards on a transferred balance. Typically, rewards are only earned on new purchases. If you have credit card debt, it’s not a good idea to be focused on rewards, anyway. According to the Federal Reserve, the average APR charged in November 2023 for credit card accounts that incurred interest was 22.75%. The best rewards credit cards, by comparison, typically offer anywhere between 1% to 10% back on the amount of your purchase. The cost of interest charges will quickly outweigh the value of rewards earned.
Consider the Card’s Ongoing Attributes
When comparing different offers, look beyond a card’s promotional period and think about if you can use the card after you’ve paid off your balance. Features to consider:
- Does the card have an annual fee? If so, is it worth keeping after your debt is paid off?
- What’s the card’s ongoing variable rate? If you don’t think you can pay off all or most of your balance and the card you’re eyeing has an above-average interest rate, you may be better off with a low-interest card.
- Will the card earn rewards? Once you’ve paid off your debt, will the card’s earnings structure match up with where you typically spend the most?
Taking Advantage of a 0% Offer Can Affect Your Credit
With few exceptions, when you apply for a new credit card, the issuer will do what’s called a hard inquiry to obtain a copy of your credit report. New credit makes up 10% of FICO Scores, so you can expect that your credit score will go down by a few points when you apply for a new card. If you open too many new accounts in a short period of time, it can signal to lenders that you might be too big of a risk to approve yet another line of credit.
A larger consideration is what a big purchase or sizable balance transfer can do to your credit utilization. Credit utilization accounts for 30% of your FICO Score and is calculated by taking your total debt (across all credit card accounts) and dividing by your credit limit (across all accounts). Typically, you want your overall credit utilization to be under 30%.
If you were hoping to open your first credit card to take advantage of a 0% APR offer so you can make a $5,000 purchase, but you’re only extended a $5,000 credit line, that would utilize 100% of your credit and is likely to adversely impact your score. However, if you have two other credit cards, each with a $10,000 credit limit, your utilization would only be 20%.
Read more: Credit Utilization Calculator
Other Things To Take Into Account Before Applying for a 0% APR Card
- Will you qualify? Cards with 0% APR offers are generally available only to those with good credit or better—typically a FICO Score of 670 and above.
- Is the 0% intro APR card issued by a different bank than your current card? Most banks won’t let you transfer a balance from one of their cards to another. Even if you get approved for a card with a balance transfer offer issued by the same bank as the card you already own, you aren’t likely to be able to to shift your debt over to the new card. A possible way to get around this is to take a check into your bank account, which some companies allow, then pay off the other card with the funds.
- You may not get approved for the limit you want. With few exceptions, credit card issuers won’t let you know how much credit you’re approved for until after you’re approved for a card. This could be a problem if you were hoping to transfer $10,000 worth of debt or make $10,000 worth of repairs to your home but only get approved for $5,000.
Bottom Line
Credit card issuers offering 0% introductory APR promotions allow consumers an opportunity to use credit cards as interest-free, short-term loans for purchases, balance transfers or both. But these offers come with risks: If a balance is unpaid by the end of the period, interest can accrue rapidly. Credit cards come with notoriously high interest rates, so be extremely disciplined about paying enough each month to zero out your debt within the no-interest period. And know that if you miss a payment or pay late, you risk losing the intro rate entirely.
Frequently Asked Questions (FAQs)
How can I get 0% APR on an existing credit card?
Issuers are highly unlikely to drop your interest rate to 0% APR, as this would mean you have no incentive to pay more than the minimum payment. An issuer may lower your rate if you ask, but don’t expect the rate to drop to 0%. However, some issuers may occasionally offer 0% APR balance transfer deals to entice you to move a balance over from a different account.
How can I extend a 0% APR period on a credit card?
You can always ask your issuer if it’s willing to extend a 0% APR promotion. Some cards offer pre-determined incentives to extension.
How much will my credit card payment be with 0% APR?
Your minimum payment depends on how your issuer calculates minimum monthly payments. Some issuers calculate payments at 1% of the outstanding balance plus fees from the previous month, while others may charge a flat rate or a percentage of your outstanding balance. Regardless, your payments should not include interest charges until the end of the 0% introductory APR period, at which point a regular APR will apply.
