6 Ways to Make the Most of a Balance Transfer Credit Card

7 Min Read | Last updated: August 28, 2023

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This article contains general information and is not intended to provide information that is specific to American Express products and services. Similar products and services offered by different companies will have different features and you should always read about product details before acquiring any financial product.

Want to know how to transfer credit card balance? Learn how you can consolidate your debts, save on interest charges, and regain control of your finances.

At-A-Glance

A balance transfer credit card can be an excellent tool to help you reduce debt faster—as long as you use it wisely.
Some credit cards offer a 0% annual percentage rate (APR) introductory period, which could help you to pay off your credit card balance sooner.
When searching for a balance transfer card, consider fees and charges to find the best option for your needs.

Used appropriately, a balance transfer credit card could be among your best tools for paying down credit card debt.

But what type of balance transfer card should you choose? One good option is a balance transfer card that offers 0% APR for an introductory period. If you choose a credit card with 0% introductory APR and commit to paying off your debt during the initial 0% period (typically ranging from 12 to 18 months), you can save in interest charges while you reduce your debt.

But not all balance transfer cards are equal. Here are a few tips to help you in your search for a 0% introductory APR balance transfer credit card.

1. Find the Best 0% Introductory APR Balance Transfer Card to Match Your Needs

Start by figuring out how many months you want to make payments, and how much you can afford per month, and then apply for cards that match your needs. It won’t make a lot of sense to get a card with a 12-month introductory 0% interest period if you’re transferring $8,000 and can’t afford the payment required each month needed to pay it off before interest kicks in.

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2. Consider Balance Transfer Fees

Keep in mind that most balance transfer credit cards charge a fee to transfer a balance. This typically will fall somewhere between 1.5 and 3.5% of your transfer balance, depending on the card.¹

3. Make Payments on Time

It’s always important to make payments on or before the monthly due date, and this is certainly the case with 0% introductory APR balance transfer credit cards. That’s because a card issuer can suspend your 0% introductory interest rate early if you miss or are late with a payment. The result could be that the variable interest rate kicks in. And some card member agreements allow the card issuer to retroactively charge you the new interest rate from the point at which you made the balance transfer.

Another reason to pay on time is that consistency can help your credit score. This can help you qualify for better credit cards, APRs, and even balance transfers in the future.

4. Stay on Plan

The best strategy with 0% balance transfer cards is to pay the full balance by the end of the introductory period. If you don’t pay as much per month as you planned, you may still have a high interest rate and a balance left to pay after the introductory period.

5. Read the Card’s Terms and Conditions

You might be tempted to skip over reading the terms and conditions—but it’s important to review these details. Here are three areas where close attention can pay off:

Transfer Limits. You might not be able to transfer the entire balance from your old card, since the transfer limit may be smaller than your approved credit limit. Other limits may apply as well. For example, you may not be able to transfer balances between cards that are from the same issuer.
Introductory Offer Expiration. The contract should also detail how much time you have to use your 0% balance transfer option. Often, the option expires after only 60 days, but your card issuer could specify more or less time.
Fees, Charges, and Penalties. Consider what interest charges will apply, what the balance transfer fee will look like, and whether there’s an annual fee. Be sure to check out the late payment penalties too.

6. Avoid Closing Out Your Old Credit Card Right Away

Once you’ve transferred the balance to your new card, you may be tempted to close out the old one. But you may want to think again. Closing your old card could shorten the length of your credit history, something that could impact your credit score. Together, the two cards will also give you a higher aggregate credit limit, which could benefit your credit score.

FAQs on How to Transfer a Credit Card Balance

How does a balance transfer work?

A balance transfer allows you to transfer an existing credit card balance to a different credit card. Some credit cards may offer new cardholders a low or 0% introductory transfer balance APR for a set period of time.

Can you get a balance transfer card if you have bad credit?

People with poor credit scores have limited balance transfer credit card options. Research potential cards and minimum credit score requirements before applying for a balance transfer credit card.

How much does it cost to transfer a credit card balance?

Credit cards will often charge a balance transfer fee. This typically ranges between 1.5 and 3.5% of each transaction.² Be sure to check your card provider’s terms and conditions to see if they allow balance transfers, and if so, what fees and charges will apply.

Can a balance transfer be denied?

A balance transfer could be denied for a number of reasons. It may be denied if the balance exceeds the credit card’s limit, if the cardholder has poor credit, or if the transfer is initiated between two cards from the same issuer. A balance transfer could be denied for other reasons as well.

The Takeaway

For people who are looking to pay down their credit card debt, a balance transfer credit card with a 0% introductory APR could help. Consider the above tips to help you find a balance transfer card that fits your needs.

^1,2 “Average cost of credit card processing fees,” Bankrate

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Scot Finnie is a journalist who covers primarily business and technology. He was Editor-in-Chief of Computerworld for more than a decade.

All Credit Intel content is written by freelance authors and commissioned and paid for by American Express.

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