Some credit cards offer introductory rates as a way to make their card more appealing. For example, some credit cards offer no interest on purchases for 12 months. A reader recently asked how these 0% on purchase cards work, and if we could provide a list of some of the best options. Let’s start with a list of the top 0% cards, followed by how these offers work.
List of 0% on Purchases Credit Cards
There are several credit cards that offer 0% interest on purchases for up to 6 to 12 months. Here are several top cards to consider:
Chase Freedom(SM): The Chase Freedom(SM) offers 0% intro on purchases for 6 months, and 0% intro on balance transfers for up to 12 months. The Chase Freedom(SM) is a strong choice because it also offers up to 3% cash back on purchases in popular rotating categories. You can check out our Review of the Chase Freedom(SM) or go directly to Chase for more information.
Citi Platinum Select: The Citi Platinum Select is a solid, low interest card that offers 0% on both purchases and balance transfers for up to 12 months. We’ve reviewed the Citi Platinum Select card, or you can visit Citi’s website for more information.
Discover More Card: Discover More offers 0% on purchases for 6 months and on balance transfers for 12 months. One big advantage of this card is its cash back features, which include up to 5% cash back on select categories of purchases. You can read our Discover More Card review or visit Discover for more information on the More Card.
American Express Blue Cash: Finally, Blue Cash by American Express offers 0% on purchases for 6 months. Like the Discover More card, Blue Cash offers cash back rewards of up to 5%. You’ll find our review of American Express Blue cards here, or you can visit Amex directly for more information.
How 0% on Purchase Credit Cards Work
Cards that offers such rates have Terms and Conditions that need to be followed or the special rate can be void. If you are looking for a 0% card or have one, the first step is to learn how the card works, because knowing these details will allow you to use the offer to its fullest.
A 0% purchase rate allows you to use the card for purchases just like any other credit card. The way the offers work is that you are not charged interest during the introductory period. While this period varies from card to card, a typical offer is usually between 6 and 12 months, as the above cards demonstrate. It is important to note that some cards restrict the 0% to only purchases. This means other transactions like balance transfers and cash advances do not apply to the 0% rate. This is why you need to read the terms of the card.
Payments for a 0% offer work the same for a 0% card as they do for any credit card. You still have to make at least a minimum payment each month. The amount varies from card to card, but 2% of the balance is a typical minimum payment. If you fail to make payments on time, go over your credit limit, or breach the credit card agreement in some other way, these cards can terminate the 0% period and begin charging you interest.
Unlike balance transfers, there is no fee to use a 0% card for purchases. At the end of the 0% introductory period, any remaining balance will begin to accrue interest at the card’s regular APR. Although 0% card offers can be very enticing, be sure you know what the rate changes to after the intro period is over. There are some credit cards that offer a low Intro rate with an extra high APR. When the 0% rate expires, the card will have a higher interest rate than it would have other cards offer without the special 0% deal. This allows the card issuer to make up the cost of the 0% card offer.
For this reason, make sure you understand what the regular APR is for any credit card. Of course, if you pay off the balance before the 0% introductory rate expires, you’ll avoid interest payments.
