D o financial literacy 0% credit card balance transfers?
Considering how high credit card APRs are, there's a lot of room to save money with a balance transfer credit card. These cards offer no interest on balance transfers for up to 21 months. During the introductory 0% APR period, you can pay off debt more quickly because you won't be paying interest.
Considering how high credit card APRs are, there's a lot of room to save money with a balance transfer credit card. These cards offer no interest on balance transfers for up to 21 months. During the introductory 0% APR period, you can pay off debt more quickly because you won't be paying interest.
You may not qualify for a worthy card
While there are options for balance transfer cards if you have bad credit, they are typically lacking compared to the best cards out there. If your score is in a lower range, you may not qualify for a card with a 0 percent intro APR offer.
In some cases, a balance transfer can positively impact your credit scores and help you pay less interest on your debts in the long run. However, repeatedly opening new credit cards and transferring balances to them can damage your credit scores in the long run.
Interest-free credit cards allow you to either transfer a balance, make purchases or transfer cash to a current account without paying any interest on your balance for a set period. However, you must keep making at least the minimum monthly repayment during this time.
Chip Lupo, Credit Card Writer
Most banks stopped offering balance transfers in 2020 because of the economic crisis triggered by the coronavirus outbreak. Balance transfers began to return to the market by 2021, and the 10 largest credit card companies all have 0% intro APR balance transfer offers now.
Your credit score is too low
Most credit card issuers want to see a good to excellent credit score (typically, a score between 670 and 850) when reviewing balance transfer card applications. A good credit score shows you're a low-risk candidate who is likely to pay off their balance.
As many as you want, as long as you stay below your credit limit. The best balance transfer credit cards give you between 60 and 120 days to transfer balances in order to qualify for the 0 percent intro APR offer, so try to transfer and pay down your balances as quickly as possible.
Transactions that don't apply to the 0 percent offer won't qualify for the interest-free introductory period. Make purchases on a credit card that only has an introductory offer for balance transfers, and those purchases will begin accruing interest at the standard rate.
If you have credit card debt on multiple cards, it can be a good idea to consolidate it to one balance transfer card to save money on interest charges and manage your debt better. You can generally transfer as many balances as you want to a single 0% APR card, but you'll need to meet certain requirements.
What is the downside of a balance transfer?
Impact on Credit Score: Initially, a balance transfer might have a negative effect on your credit score. This is one of the disadvantages of a balance transfer. Applying for a new credit card leads to a hard inquiry on your credit report, which can temporarily lower your score.
The debt can be paid off quickly
A balance transfer generally isn't worth the cost or hassle if you can pay off your balance in three months or less. That's because balance transfers typically take at least one billing cycle to go through, and most credit cards charge balance transfer fees of 3% to 5% for moving debt.
In many cases, a balance transfer can save you money, but there is a catch: The rate is an introductory rate, meaning that it will end after a certain period of time.
| LENDER | 0% PERIOD + FEE (i) | APPLY |
|---|---|---|
| Virgin Money | - 20mths 0% - 2% fee - 24.9% rep APR | Check eligibility |
| Apply* | ||
| Barclaycard | - Up to 12mths 0% - NO FEE - 24.9% rep APR | Check eligibility |
| Apply* |
Key takeaways. When you transfer a balance to a new card, the old card's balance will read as $0 unless you have pending purchases or are unable to transfer the full amount. Once you've paid off your balance on the new card, consider keeping it open for the sake of your credit score (and any perks the card offers).
A balance transfer credit card can come in handy when you want to pay less interest on the debt you owe on an existing credit card. This maneuver can save you money and buy you a little extra time to repay your debts, but not everyone is a good candidate for a balance transfer.
Banks make money from 0% APR credit cards through a few different avenues. While they may not charge interest on the outstanding balance during the promotional period, they often make up for this in other ways. First, they may charge balance transfer fees when customers transfer existing balances to the 0% APR card.
With some credit cards, you can request balance transfers while filling out the application before you're even approved. Phone. You can call your issuer to request a balance transfer. As with online balance transfers, come prepared with information about the debt you're looking to move.
Pick which cards you want to pay down and then transfer the balance to your Chase card with an eligible lower rate. Consolidate balances. Make managing your finances easier by combining several credit card balances into one. Pay for unexpected expenses or get cash.
| Credit card | Balance transfer details |
|---|---|
| Navy Federal Credit Union Platinum Credit Card* | 0.99 percent intro APR on balance transfers for 12 months (11.24 percent to 18 percent variable APR thereafter) |
| DCU Visa Platinum Credit Card* | 13.75 to 18 percent variable APR |
How do you avoid interest on a balance transfer?
Go for the 0% balance transfer offer, but don't use the card for any purchases until you've completely paid off the balance transfer. 3. Choose a credit card that offers a 0% introductory APR for the same number of months on both balance transfers and new purchases. Numerous such offers are advertised in the market.
Usually, the only way to avoid balance transfer fees is to find a card that waives the fee entirely, and these types of cards are usually issued by credit unions. It's also possible that you'll come across a credit card with an intro balance transfer fee offer.
Credit card providers typically determine the amount of debt you can move in relation to your credit limit. Many issuers are generous, giving cardholders the ability to transfer their full credit limit, but in some cases, your transfer limit may be capped at 75 percent of your overall credit limit.
No, you cannot use a credit card to pay other credit card bills. However, credit cards often have options like cash advance or balance transfer that give you access to "cash" funds. If you are short on money to pay your bills, you can use these funds to pay off your balance.
A balance transfer credit card can offer you many months to pay off high-interest debt in the form of a 0% introductory APR. But when that balance transfer period ends, interest charges are added to the balance if it isn't paid off.
