Balance Transfer Credit Card Reviews

A balance transfer on a credit card involves moving the existing debt from one credit card to another, typically with the goal of obtaining more favorable terms, such as a lower interest rate. Balance transfers can be a useful strategy for individuals looking to consolidate debt or save on interest payments. Learn more about balance transfer credit cards.

Performing a balance transfer involves several steps. Here's a step-by-step guide on how to do a balance transfer:

1. First, choose the right card. Research and choose a credit card that offers a balance transfer option. Look for cards with a low or 0% introductory APR on balance transfers and consider factors such as transfer fees and the regular APR after the introductory period. You’ll also want to check the credit limit. Review the credit limit on the new credit card to ensure it can accommodate the amount you want to transfer, including any fees.
2. Activate the new card and initiate the balance transfer. Once you receive your new card, activate it and initiate the balance transfer. Collect information from the credit card account you want to transfer the balance from, including the account number, the amount you want to transfer, and any other required details. Log in to your new credit card account online or call the customer service number. Look for the balance transfer option and provide the necessary details, including the account information and transfer amount.
3. Verify the transfer terms. Confirm the terms of the balance transfer, including any fees associated with the transfer and the promotional APR period. Take note of the expected completion time for the transfer.
4. Continue making payments. Keep making payments on the old credit card until you confirm that the balance transfer is complete. This ensures you avoid any late fees or penalties.
5. Monitor the transfer. Regularly check your new credit card account to confirm that the balance transfer has been processed. It may take a few days to several weeks for the transfer to be completed.
6. Repay the transferred balance. Plan a repayment strategy to pay off the transferred balance, especially if there's a promotional 0% APR period. After this period ends, any remaining balance will be subject to the regular APR.
7. Consider closing the old account. Once the transfer is complete and you've paid off the balance, consider whether you want to keep or close the old credit card account. Closing an account can impact your credit score, so weigh the pros and cons.

It's important to read and understand the terms and conditions of both the old and new credit cards before initiating a balance transfer. Be aware of any fees, promotional periods, and the regular APR that will apply after the promotional period ends. Additionally, keep in mind that credit card offerings and terms can change, so always check for the latest information.

Learn more about how to do a balance transfer.

Balance transfer fees are charges imposed by credit card issuers when you transfer a balance from one credit card to another. These fees are typically expressed as a percentage of the amount being transferred and are added to the balance on the new credit card. Some credit cards offer promotional periods with reduced or waived balance transfer fees as an incentive for new cardholders. Be sure to check for any such offers when considering a balance transfer.

Balance transfers can have both positive and negative effects on your credit score, depending on various factors. For example, they can have a positive effect as a new balance transfer credit card can help your credit utilization ratio, as well as help you consolidate your debt and therefore simplify your debt management. This can help you make your payments more consistently, which is a positive factor in your credit history.

On the other hand, when you apply for a new credit card to facilitate the balance transfer, the credit card issuer may perform a hard inquiry on your credit report. Hard inquiries can have a small, temporary negative impact on your credit score. Opening a new credit account can also affect the average age of your credit accounts. Finally, if you close the old credit card account after transferring your balance, it may reduce your total available credit. This, in turn, can impact your credit utilization ratio.

While balance transfers can influence your credit score, the impact is generally temporary, and responsible use of credit can help mitigate any potential negatives.

Learn more about how balance transfers can affect your credit score.