If you’ve come to the end of your current balance transfer promotion and haven’t repaid your entire debt, there are ways for you to avoid paying high interest rates on the remaining balance. You may be able to move your remaining debt to a new credit card with a low or 0% intro APR on balance transfers. While there are technically no restrictions on the number of times you can transfer your credit card balance, you should be aware that you can’t transfer your debt to a card offered by the same provider (or any of its affiliates) which means you’ll run out of providers quicker than you might think.
Apply for a balance transfer credit card and enter your current credit card details when prompted by the online application, or call the number on the back of your new card once you receive it if you’re not asked to balance transfer at the time of application.
Keep in mind that your second balance transfer will be subject to the credit card provider’s lending criteria. This includes a credit check that will show your previous applications and current credit accounts — meaning they’ll see when you applied for your first balance transfer card. This could raise red flags for them, possibly resulting in rejection.
What you could save by making a second balance transfer
Let’s say you have a debt of $14,000, which you move to a new card that doesn’t charge a balance transfer fee and has a 0% intro APR on balance transfers for six months. During the promotional period, you’re able to pay the debt down to $11,000. Now that it’s over, you’ll start paying a 19% variable APR.
Here’s how much you could save by transferring the balance again, assuming:
You’re able to pay the debt down to $6,000 during the intro period.
The balance transfer fee brings the total debt to $11,330. That means it would take $5,330 to pay it down to $6,000.
Had you paid interest on the previous card during those six months, it would’ve run about $900. Meaning once you account for the balance transfer fee, the second transfer will have saved you about $570.
Compare balance transfer credit cards
Five factors to consider before applying for a second balance transfer
Is the debt eligible to be transferred? You must transfer your debt to a credit card from a different bank to be eligible for a balance transfer promotion. For example, if you have a Scotiabank credit card, you can transfer the balance to an American Express credit card but not another Scotia credit card or Tangerine card (since Scotiabank is the parent company of Tangerine).
Do you meet the credit card eligibility requirements? Every credit card has a list of application requirements that you need to meet to be eligible to apply. Canadian citizenship or permanent residency, a minimum age limit and minimum income factor into your eligibility. Read our guide on how to ensure your balance transfer application is successful for more tips on how to improve your likelihood of approval.
Is there a balance transfer limit? There’s likely a minimum and maximum amount you can transfer. The minimum amount may be as low as $25 – but it will differ between providers. The maximum balance transfer amount varies depending on the provider and your creditworthiness, and is often expressed as a percentage of your credit limit and/or a dollar amount. For example, American Express allow you to transfer up to 50% of your approved credit limit or $7,500, whichever is less.
How will this impact your credit score? Every application for credit is recorded on your credit report. Applying for too many credit cards can hurt your credit score because each application triggers a hard inquiry, which lowers your score by a few points each time. Once you make timely repayments, your score will rise again.
Are there balance transfer fees? Some providers charge a balance transfer fee. The typical fee is 1% to 3% of the amount you want to transfer and is usually deducted from your remaining credit limit. It’s also important to consider other costs, such as the annual fee and the revert interest rate (the rate your debt will take on once the promotional period ends). The transfer likely isn’t worth it if these costs outweigh the savings earned by paying off all – or part – of your remaining debt without interest.
What is credit card kiting?
Credit card kiting is the act of using credit cards to make it seem like one has more purchasing power than they actually do. This can involve tactics such as taking out a cash advance with one card to make the minimum payments on another.
Another means of kiting involves taking advantage of introductory rates by continuously transferring balances between cards without paying the balance.
Simply making a second balance transfer, however, doesn’t constitute as credit card kiting. Just make sure you’re paying down your balances to avoid running into trouble.
Mistakes to avoid when doing a second balance transfer
Waiting to make your balance transfer. Most balance transfer credit cards require you to make the transfer within 30 days of opening your account. Waiting too long to transfer your debt to the new card could mean missing out on the intro APR period entirely.
Using your balance transfer credit card for purchases. Balance transfer credit cards charge a higher interest rate on purchases. Depending on the terms and conditions of your card, your repayments may automatically go toward the debt that’s accruing the highest interest – which could mean your debt will just sit there while you pay off any new purchases first.
Making a late payment. Many balance transfer credit cards have penalty APRs that kick in if you make a late payment, which means you’ll lose out on any months you had remaining in your 0% or low introductory APR period. Set up a calendar reminder or enroll in autopay to ensure you never miss a payment.
Not making a payoff plan. Since the goal with opening up a second balance transfer credit card is to pay off your debt before the 0% or low APR promotional period ends, make a plan to pay off your balance before the intro period is over by looking into how much you’ll need to pay each month. You may need to create a monthly budget and stick to it.
You may not want to close your old accounts directly after transferring your debt. By closing your old credit card accounts, you could negatively affect your credit score. This is because both your credit utilization rate and the age of your credit cards will change, which will directly impact your credit score.
Before trying to avoid interest charges on your debt, weigh all of the factors above before you apply for a second balance transfer credit card. Remember that any balance transfer card you apply for will be subject to approval and recorded on your credit report, so it pays to do your research first before lodging your application.
Ideally, you should do this at the time of your application. If not, then reach out as soon as you find out that you’ve been approved for the credit card. This way, you can make sure your balance transfer is complete within the time period your provider requires. Some will waive balance transfer fees at the time of application too, so it can save plenty of money if you know you want to complete one.
Yes, it’s possible to find a credit card provider that offers both a promotional APR period on the transferred balance as well as a $0 transfer fee.
Rhys Subitch is a writer and editor at finder.com who tackles topics across the site. With half a decade of experience researching, editing and writing for a Fortune 500 company, university and several independent publications, Rhys brings readers the most up-to-date and curated info on all things finance.
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