What happens when you combine credit card balances with your credit report? If you regularly carry a balance on your credit cards, it could be costing you more than interest charges on the carried balance. Whenever you apply for a loan or a credit card, the credit issuer checks your credit record and your credit score. They'll use what they learn from your credit record to decide not only whether to give you credit, but also what interest rate they'll charge you for the loan or credit card.
One of the major factors in your credit score is the ratio of debt to available credit. The higher that ratio is the higher will be the interest rates that you'll be offered. When you carry balances on your credit cards, you raise your debt to credit ratio, which will translate into higher interest rates on any loans that you may be offered. If you're applying for a mortgage, that could translate to hundreds of pounds per year for an increase as little as .05%.
Often, the utility companies will also check your credit record when you apply for service. A low credit score may prompt them to require a security deposit before they'll open a service account in your name. Low credit scores can lose you the flat you want to rent or the promotion or job for which you've applied. And of course, you'll be paying interest on any balances that you carry on your credit cards.
If there is a good reason to carry a balance on your credit card, you'll want to put it on the best credit card for the job. If you're paying interest on a carried balance, you may be able to avoid paying interest on that balance by transferring it to a 0% balance transfer card. You can compare credit cards details and apply for a credit card online at a site that allows you to compare credit cards side by side. That way you'll be sure to get the best credit card for your circumstances.
