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How to deal with balance transfer credit card problems

Avoid these common mistakes that make paying off debt difficult.

Transferring existing debt to a new credit card can be a good way to consolidate your payments and pay down what you owe faster – and cheaper. With a balance transfer credit card that offers a low or 0% APR intro period, you could potentially save hundreds or even thousands of dollars on interest payments.

At the end of the day, however, your credit card provider benefits from any mistakes you make. Here’s how to avoid common oversights and recover from pitfalls so you can get the most out of your balance transfer credit card.

You applied for a card with the same provider

Balance transfer offers come with a range of terms and conditions that must be met in order to be eligible for the offer. One eligibility requirement usually states that you can’t balance transfer between the same credit card provider. So, you can’t take advantage of a Scotiabank balance transfer when you already hold your credit card debt with Scotia.

One important note to keep in mind is that your provider’s card may actually be underwritten by another financial institution. MBNA, for example, is owned by TD, and therefore you can’t transfer your debt to an MBNA credit card if you hold your debt with either TD or MBNA, and vice versa.

What’s tricky is that if you do apply for a new credit card with the same provider, you could end up being approved for the card — and maybe even the balance transfers, in some cases — but you won’t get the promotional rate. This could leave you with more credit cards and no lower interest rate – putting you in a possibly riskier position of getting into even more debt.

What to do about it

If you accidentally apply for a balance transfer with an existing card provider, your next steps depend on the stage of your application when you become aware of it:

  • During the application process. If you’ve received conditional approval for the card but haven’t yet submitted supporting documentation, call the provider to cancel your application. Let them know that your existing debt is with the same provider and that you’re no longer interested in the offer.
  • After you card application is approved. If your card and balance transfer is approved, let your provider know your concerns. Some providers process applications quickly, leaving them little room to find a problem until they try to transfer your balance. In other cases, you could be approved for the card but not the balance transfer offer.
  • After your card application is declined. Your application may be declined because the provider realized you already own a card from them – or one of their affiliates. While you can apply for a different balance transfer card, remember that applications are listed on your credit report, and applying for too many cards in a short time may negatively affect your credit score.
  • If you actually want to transfer a balance to a card with your existing provider. While it’s rare, some credit card providers offer balance transfers specifically for existing customers, which is a legitimate way to stay with your provider. If you find such an offer, carefully read the terms and conditions to be sure your specific transfer is eligible.

Compare balance transfer credit cards

Name Product Welcome Offer Purchase Interest Rate Cash Advance Rate Balance Transfer Rate Annual Fee
Offers a 0.99% introductory interest rate on balance transfers with 0% transfer fee for the first 6 months. Ends 30 June 2019.
12.99%
12.99%
0.99% for the first 6 months (then 12.99%)
$29
Save on interest by consolidating your higher-rate balances and enjoy a low 12.99% purchase interest rate.
Earn up to 5% or $300 cashback in your first six months.
19.99%
22.99%
1.99% for the first 6 months (then 22.99%)
$99
Offers 1.99% balance transfer rate in the first 6 months. No balance transfer fee upon application.
Earn up to 2.5% or $150 cashback in your first 3 months.
19.99%
22.99%
1.99% for the first 6 months (then 22.99%)
$0
Offers 1.99% balance transfer rate in the first 6 months. No balance transfer fee upon application.
Get 2,500 bonus SCENE points with min. spend of $500 in the first 3 months. Ends 30 June 2019.
19.99%
22.99%
22.99%
$0
Save on $0 annual fee and earn 1 SCENE point for every $1 spent on all purchases.
Get 1.95% interest rate on balance transfers for the first six months. Valid within the first 30 days of account opening.
19.95%
19.95%
1.95% for the first 6 months (then 19.95%)
$0
Earn 4% Money-Back Rewards in three categories of your choice such as groceries, dining, petrol and more. Ends 31 July 2019.
Offers a 3.99% introductory interest rate on balance transfers with 0% transfer fee for the first 6 months. Ends June 30, 2019.
16.99%
16.99%
3.99% for the first 6 months (then 16.99%)
$0
Save on low interest rate and no annual fee.
No available introductory offer.
17.99%
17.99%
17.99%
$0
Get up to 5% in GM Earnings on your initial spend of $5,000 in the first year.
Get 10% cash back on purchases with min. spend of $2,000 in the first three months. Ends 30 June 2019.

19.99%
22.99%
22.99%
$0 annual fee for the first year ($99 thereafter)
Enjoy a $0 annual fee for the first year.
Get 30,000 bonus Scotia Rewards points with min. spend of $1,000 in the first 3 months. Ends June 30, 2019.
19.99%
22.99%
22.99%
$139
Earn 2 Scotia Rewards points per $1 spent on eligible purchases. Plus, an extra 10,000 points with a min. annual spend of $40,000 on your card.
7.99% introductory interest rate on all spend for the first six months. Ends 30 June 2019.
7.99% intro APR for the first 6 months, 19.99% thereafter
22.99%
22.99%
$0
Get 1% cash back on payments made at gas stations, grocery stores and pharmacies, including recurring payments.
Offers a 2.99% introductory balance transfer rate for the first 6 months. Ends 30 June 2019.
19.99%
22.99%
2.99% for the first 6 months (then 22.99%)
$39
2% cash back on eligible gas stations, grocery and drug store purchases including recurring payments. T&C's apply.
Receive 5,000 bonus Scotia Rewards points upon first eligible purchase within the first 2 months. Ends 30 June 2019.
19.99%
22.99%
22.99%
$110
Get 5% cash back on travel purchases via Scotia Rewards Travel Service and earn 1 Scotia Rewards point for every $1 spent on daily purchases.
Receive 30,000 bonus Scotia Rewards points upon first eligible purchase within the first 2 months. Ends 30 June 2019.
19.99%
22.99%
22.99%
$399
Earn 4x Scotia Rewards points per $1 spent at grocery stores, gas stations, dining and entertainment purchases.
Get 5,000 bonus Scotia Rewards points with min. spend of $500 on eligible purchases within the first 3 months. Ends 30 June 2019.
19.99%
22.99%
22.99%
$0 to $0
Earn 1 Scotia Rewards point per $1 spent on eligible purchases.
Waived annual fee for the first year of membership. Ends 30 June 2019.
19.99%
22.99%
22.99%
$0 annual fee for the first year ($79 thereafter)
Get up to 5% in GM Earnings upon initial spend of $10,000 in the first year and 2% subsequently.
Receive 2,000 bonus AIR MILES Reward miles when you spend $1,500 within the first three months of membership.
19.99%
22.99%
1.99% for the first 6 months (then 22.99%)
$65
Offers 1.99% balance transfer rate in the first 6 months. No balance transfer fee upon application.
Offers a 7.99% introductory interest rate on all spend for the first 6 months. Ends 30 June 2019.
7.99% intro APR for the first 6 months, 19.99% thereafter
22.99%
22.99%
$0
Receive 1% cash back on payments made at petrol stations, supermarkets, pharmacies and recurring bill payments.
Receive 2,400 Air Miles Reward Miles when you spend $3,000 within first three months of membership.
19.99%
22.99%
1.99% for the first 6 months (then 22.99%)
$299
Offers 1.99% balance transfer rate in the first 6 months. No balance transfer fee upon application.
Get 15,000 bonus Scotia Rewards points with min. spend of $1,000 within the first 3 months. Ends 30 June 2019.
19.99%
22.99%
22.99%
$99
Earn 4 Scotia Rewards points per $1 on the first $50,000 annual spend on eligible purchases.

Compare up to 4 providers

You’re approved for a partial balance transfer

Partial transfers often come down to credit limits, so we’ll start there. When you apply for a balance transfer, card providers typically cap the maximum amount you can transfer to your card. Most providers allow you to transfer a specific percentage of the credit limit you’re approved for on a new card — often between 50-70% of your total credit limit amount. Other providers may allow you to transfer up to a certain dollar amount, or may allow you to choose between the set percentage or dollar amount – whichever option is lower.

If you’re approved for a credit limit that isn’t large enough to move all of your debt, your new provider may allow for a partial balance transfer. The problem is that you end up with two debts: one on your old card and another on your new card. Your new card might offer a 0% APR intro period, but you’ll still pay interest on your old card’s remaining balance.

What to do about it

  • Cancel your application. After the new provider sends your new card’s terms and conditions, you can cancel your application. At that point, you’re expected to either accept or reject them.
  • Pay off your old card’s remaining debt. Pay off this old balance as soon as possible so that you can focus on dealing with the rest of your debt under your new card’s lower promotional rate. Don’t forget that you’ll need to make at least the minimum repayment amount on your new card though.
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You’re paying more fees than you expected

Balance transfers often come with additional costs that we can forget about until they show up on our statements. In particular, balance transfer fees and annual fees can put a dent in what you could save.

Fees can add up to more debt and a larger balance, especially when the fees are not covered under the promotional rates and you don’t pay them off in full. Usually, lenders are required to put your payment to the purchases that are attracting the highest interest rates, however you’ll need to make sure you make more than the minimum repayment to cover the fees in full. In addition, balance transfer fees are usually added on to your debt when the provider moves it to the new card at the beginning of opening your account.

What to do about it

  • Prioritize your payments. By the time you notice these charges, it could be too late to avoid them, especially if they’re mentioned as part of the terms and conditions you accepted when taking on the card. If there’s no cause for dispute, prioritize paying off these charges first — even if it means adjusting your budget. That way, you’ll avoid (or at least reduce) the interest you pay on them.
  • Look for a no annual fee or no balance transfer fee card. There are a few balance transfer cards on the market that charge no annual fees, so you could potentially apply for one from the get-go. You can also find some cards that charge no balance transfer fee when you move your debt to the new card. Keep in mind it might be difficult to avoid both fees, so you’ll need to do the math and figure out if it’s cheaper to pay an annual fee, a balance transfer fee, or pay both but get a lower or 0% APR on your debt for a longer period of time.
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You forgot to make a payment

This mistake often comes up with 0% intro APR balance transfer offers, which can make it feel like missed payments are no big deal. Even if there’s no interest applied to your balance, you’ll still have to at least pay the statement’s minimum each month. Otherwise, you could end up dealing with late payment fees and other penalties that include losing your intro offer altogether.

It can take some time to get approved for your new card, as well as receive confirmation that your new provider transferred your balances from all of your old cards. This entire process can take up to six weeks, so in the meantime, you’ll need to continue paying the balance(s) on your old card(s) to avoid late payment fees and other penalties.

What to do about it

  • If you missed a payment on any of your cards. Contact the card provider immediately. Explain that you missed a payment, and let them know when you plan on making one — or make the payment and call them after.
  • Avoid future missed payments. Sign up for autopay with your new card, which can prevent late payments on your account.
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You kept your old credit card account open and made new purchases

If you don’t cancel the cards you’ve transferred balances from, you might be tempted to use them to make new purchases. It could undo the work you did to simplify your debt repayments and add new interest and other charges to your debt.

What to do about it

  • Pay off what you charged as soon as possible. Confirm there’s no balance on the old card, otherwise, you won’t be able to cancel it.
  • Inquire about any fees. Ask about how long the cancellation can take and any fees so you can plan accordingly.
  • Confirm the account is closed. Request written confirmation from your old credit card provider when the process is complete. Most providers will provide this automatically, but it’s good to ask anyway.
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You made new purchases on your balance transfer card

With balance transfer credit cards, new purchases accrue interest at the card’s purchase rate – not the lower intro rate.

Most banks and providers apply your monthly payment to higher interest charges first. This means your transferred balances could sit around until after your new purchases are fully repaid and you may lose out on your 0% intro APR balance transfer offer.

Put simply: New purchases on your balance transfer card risks fully paying off your debt, regardless of the card.

What to do about it

  • Prioritize paying off new charges. You can get back to paying off your original transferred debt once you’ve paid off the new purchases in full. At the very least, you should work to increase your monthly repayments to factor in the new debt.
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You’re carrying a balance when the introductory rate reverts

After your introductory period, your card’s APR reverts back to the standard or purchase rate offered to you at approval. The difference between your intro rate and revert rate could be as much as 24.99% – or higher. If you’re carrying a balance when the introductory period is over, the new interest rate applies to whatever is left on your card.

Depending on the card, if you don’t manage to pay off your debt in full by the time the intro APR ends, the provider may add the total deferred interest to your card’s balance in addition to the balance accruing interest at the revert rate. This doesn’t happen with all balance transfer cards, but it’s another reason to properly read the terms and conditions and fully understand the offer and the card.

What to do about it

  • Pay the remainder off as quickly as possible. This could mean adjusting your budget to make larger monthly payments or using your savings to clear the balance.
  • Make more frequent payments. While credit card interest is charged monthly, it’s actually calculated daily. With more frequent payments, you might be able to reduce the overall interest you pay.
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You ended up with more debt

Your main reasons for transferring debt should be to reduce the total amount of money you end up paying in interest and to potentially condense multiple payments into one. After all the hard work you’ve put towards paying down your debt, the last thing you want to end up with is … well, more debt.

When transferring your credit card balances, read the fine print and understand the conditions your new provider outlines. The easiest way to avoid ending up with more debt is to prevent the conditions that cause it in the first place.

What to do about it

  • Keep on top of payments. Commit to paying down as much of your balance before your intro rate expires.
  • Avoid losing your intro APR. To do so, pay your bill on time. Set up autopay or alerts to remind yourself when it’s time to make your payment.
  • Avoid new purchases on your balance transfer card. While some cards may offer a balance transfer promotion and a low APR on new purchases, many restrict the low or 0% rate to transferred amounts only. Avoid the high purchase rate by avoiding new purchases altogether.
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Bottom line

The ideal solution to balance transfer problems is preventing them in the first place. While that’s not always possible, one slip up doesn’t mean you’ll be thrown off the path to financial freedom altogether. Assess your financial situation, compare your card options and properly read and understand a card’s terms and conditions. If you have any questions or don’t understand something, reach out to the provider.

Now that you know what to avoid, compare balance transfer credit cards to find the best option for your financial needs.

Frequently asked questions

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