As regular readings know, we track very closely 0% APR introductory offers from most major credit card issuers. Today Chase announced a change in the no interest offer on its Chase Freedom credit card, and we want to pass this important change along to you. Here’s the deal.
Chase shortened the 0% on purchases from 12 months down to 6 months. That means new card holders will still get interest free use of the card on purchases, but now only for the first 6 months, not 12 months. On the bright side, the Chase Freedom card now offers 0% on balance transfers for up to 12 months, which is the longest no interest balance transfer currently offered by credit card issuers. So why did Chase make this change?
The reasons aren’t exactly clear, but Discover credit cards has recently made the same move. It appears that balance transfers must be more in demand than 0% purchase offers. These changes may also be Chase preparing for the new Credit Card Act legislation which takes effect this month.
In addition, Chase has removed the $50 bonus it offered after the first purchase. It’s disappointing to see this go, but the card still pays up to 3% cash back on select purchases, and 1% cash back on everything else. As a long-time Chase Freedom card holder, it’s still one of my favorite cards.
As a quick refresher, there are two types of interest free offers–0% on purchases and 0% on balance transfers. These two types of offers are very different. With 0% on purchases, you don’t pay any interest on purchases for usually 6 or 12 months, depending on the terms of the offer. There are no fees to take advantage of this offer; just use the card for purchases as you normally would. With balance transfer offers, you can transfer high interest debt from other cards onto the new card and pay no interest for up to 12 months. There is a transfer fee involved, usually 3% of the amount transferred.
