← Back to Glossary
Interest-Free Period
Definition
An interest-free period is a promotional timeframe during which no interest is charged on purchases or balance transfers, typically offered on credit cards.
Explanation
Interest-free periods on credit cards typically last 12-18 months for balance transfers and 6-12 months for purchases. During this time, 100% of your payment goes toward principal. After the period ends, the standard APR applies to remaining balances, often retroactively from the original purchase date.
Make a plan to fully repay before the promotional period ends. Read the fine print about retroactive interest.
Example
A 0% APR for 15 months on a $3,000 balance transfer means no interest if paid in full within 15 months. After that, the standard 22% APR applies.