Is a balance transfer card right for me? 8 points to consider | finder.com
Is a balance transfer credit card right for me

Is a balance transfer credit card right for me?

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Understanding the balance transfer process and whether it’s right for you.

A balance transfer is a great way to pay off your existing credit card debt at a much lower rate, but these deals are restricted by many terms and conditions.

Our pick for balance transfers: Blue Cash Everyday® Card from American Express

  • Earn a $150 statement credit after you spend $1,000 in purchases on your new card within the first 3 months.
  • 3% cash back at U.S. supermarkets (on up to $6,000 per year in purchases, then 1%).
  • 2% cash back at U.S. gas stations and at select U.S. department stores, 1% back on other purchases.
  • Low intro APR: 0% for 15 months on purchases and balance transfers, then a variable rate, currently 15.24% to 26.24%.
  • You spoke, we listened. Over 1.6 million more places in the U.S. started accepting American Express® Cards in 2018.
  • Cash back is received in the form of Reward Dollars that can be easily redeemed for statement credits, gift cards, and merchandise.
  • No annual fee.
  • Terms apply.
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Is a balance transfer a good idea?

Several factors may influence whether or not you would benefit from a balance transfer card.

  • Is your interest rate making it difficult to pay down your balance?

    When interest rates are high enough to make it nearly impossible to pay down your principal a balance transfer may be a good idea to get a better rate.

  • Can you qualify for a high enough credit limit?

    To transfer the whole balance from one or more accounts you’ll have to qualify for a high enough credit limit.

  • Is the intro period going to be long enough?

    Some balance transfer cards offer a low or 0% APR for a certain length of time when you first transfer. Promotional periods can range from six to 21 months, which can give you time to pay down your newly-transferred balance.

  • How much will you actually save?

    Balance transfers can come with fees — usually from 3% to 5% of the amount being transferred. The fee, intro and revert APRs, introductory period and your budget should be considered when you’re calculating potential savings.

  • Can you keep from spending more?

    Keeping your old cards open will make for a lot of freed up credit. Temptation can build, so you’ll need to keep that urge to shop in line.

  • Is your credit score good?

    Your ability to qualify for the card that’s right for your situation is also something to keep in mind. Getting another card with a high revert rate or an intro that’s not long enough may not be the best solution.

How a balance transfer works

Balance transfers are fairly straightforward. The goal of a balance transfer is to move one or more debts onto a new credit card. Usually this is done to consolidate debt or get a lower APR.

Once you’ve found a card that you’d like to transfer your debt to it’s time to get the process going. To start a balance transfer you’ll need to gather your current account information, including the amounts you want to transfer, the bank name, routing number and account number.

You’ll give the information you’ve gathered to the new credit card provider and the transfer will get started. During the time of the transfer you’ll have to continue making your regular monthly payments. Transfers can take anywhere from a few business days to a few weeks depending on all parties involved.

How much you can transfer

Some banks will allow a minimum of $100, others may set the minimum at $500.

In terms of maximums, it depends on the institution. Typically the maximum sits between 75% and 100% of your approved credit limit.

Confirm what the minimum and maximum transfer amounts are by checking your relevant product disclosure statement.

Credit Limit70%80%90%95%
$2,500$1,750$2,000$2,250$2,375
$5,000$3,500$4,000$4,500$4,750
$7,500$5,250$6,000$6,750$7,125
$10,000$7,000$8,000$9,000$9,500
$12,500$8,750$10,000$11,250$11,875
$15,000$10,500$12,000$13,500$14,250

Which banks you can transfer your balance to

You generally can’t transfer your debt to a card with the same bank. Cobranded cards and shop cards may not be transferred to some providers. For example, you can’t transfer a balance from a SaksFirst World Elite Mastercard® to a Capital One card because it’s issued by Capital One.

What the revert APR is

Your low or 0% balance transfer rate will only last for the length of the promotional period, after which it will revert to a much higher interest rate. If this rate is higher than your current one, it may not be worth transferring the balance if you can’t pay the balance off before the intro APR period ends — though this also depends on what the balance transfer fee is.

How long a balance transfer takes

This depends on the financial institutions involved. It usually takes about two weeks to complete. The balance transfer intro period may begin as soon as your account is approved, though some providers don’t start it until the transfer is complete.

Compare balance transfer credit cards

Updated March 26th, 2019
Name Product Intro Balance Transfer APR Balance Transfer Fee Recommended Minimum Credit Score
0% for the first 15 months (then 17.24% to 25.99% variable)
$5 or 3% of the transaction, whichever is greater
670
0% intro APR for 15 months from account opening on purchases and balance transfers.
0% for the first 15 months (then 17.24% to 25.99% variable)
$5 or 3% of the transaction, whichever is greater
670
0% intro APR for 15 months from account opening on purchases and balance transfers.
0% for the first 15 months (then 15.24% to 26.24% variable)
$5 or 3% of the transaction, whichever is greater
680
Earn a $150 bonus statement credit after you spend $1,000 on purchases in the first 3 months. Rates & Fees
0% for the first 15 months (then 15.24% to 26.24% variable)
$5 or 3% of the transaction, whichever is greater
680
Earn a $150 statement credit after you spend $1,000 or more in purchases with your new card within the first 3 months of card membership. Rates & Fees
0% for the first 12 months (then 15.24% to 26.24% variable)
$5 or 3% of the transaction, whichever is greater
680
Earn $200 bonus cash back after you spend $1,000 on purchases in the first 3 months. Rates & Fees

Compare up to 4 providers

Bottom line

How much you can get out of a balance transfer card depends on your specific financial situation. Be sure to take your time while researching companies and solutions to find the one that best meets your needs.

Getting out of debt can feel like an endless cycle, but you may be able to take great strides forward with planning and patience.

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