What is a rate tart?

A rate tart is someone who tries to keep all debts at 0% by continually switching card deals. The number of people who constantly move from one card to another when their 0% rate ends is growing.

The month before the card interest free period ends, if the card still has debt, transfer the balance to a new card with a 0% balance transfer offer and keep moving it to 0% offers until the outstanding debt it’s completely paid off. At the same time for new spending, apply for a new card with an introductory interest free rate for purchases.

Zero interest chasing is without doubt the cheapest method and if managed correctly will mean you won't pay interest on any balances. However this takes active management, if you forget to move the debt in time you will be charged interest and the costs shoot up. If that’s likely to happen to you're better to go for a card with a low standard rate.

If used sensibly, rate tarting will not have a negative impact on your credit score. Neil Munroe, a spokesman at credit rating agency Equifax, says: 'Every time you apply for a card, a credit search is made and goes on your file. But if you take out another card after six months and transfer the balance, this will show as paying off the old card. A lender will see this as a good sign that you can maintain credit well.'

However multiple card application rejections will damage your credit rating. So if you are rejected for a card, its important to check your data is correct with the UK's two largest Credit Reference Agencies, Equifax and Experian.