When the concept of 0% interest on credit balance transfers caught on, card providers looked to recoup some of the costs of the "perk" by charging the standard interest rate for new purchases. When cardholders overpay their monthly minimum amount to lift themselves out of the red, the excess payment is usually set against the transferred balanced - leaving cardholders exposed to full interest rate charges on new purchases. Nationwide and a few other cards are willing to use overpayments to clear highest interest-bearing debts first. However, Stuart says canny cardholders switching debts often avoid using the new card for any new purchases whatever. They just wait until the 0% offer expires, then switch to another card. Although 70% of cardholders clear debts fast and pay no interest charges whatsoever, the average debt among the remaining 30% is about £2,000. Not all, says Stuart, are helpless cash-strapped consumers. "For people who bring great discipline to their financial affairs, it is possible to use £10,000 outstanding on credit cards to reduce mortgage repayments. The risk is that people are tempted to make other purchases - and seriously exceed borrowing limits." However, the curious success of the "rate tarts" should not blind anyone to the fact that juggling debts on different cards is a dangerous path for many who try it. For some, it has built up five figure debts and - in the worst cases - driven desperate people to suicide. There have been an increasing number of tragic cases where customers have been unable to resist the temptation to run up debts they have no hope of repaying. Forklift driver Derek Rawson, 51, was in despair after amassing debts of almost £100,000 - most of them on 16 credit cards. He hanged himself at his home in Yaxley, Cambridgeshire. In another tragic case, Stephen Lewis, 37, who earned £22,000 a year, had 19 cards and was being hounded by telephone calls and letters from banks and building societies. The father of two from Worksop, Nottingham, killed himself owing debts of £65,000. It's no wonder credit card firms have come under fire for encouraging people to take on debts they can't afford. With one, possibly two, rate rises still in the pipeline for 2005, even "rate tarts" could get their comeuppance. But John Ryder is confident the game isn't over yet. "I always think there will be a portfolio of issuers that are prepared to have the money in their account. "They may be thinking they aren't going to make money out of this guy, but at the same time they won't want you to take your custom elsewhere." | 
