Balance Transfer Credit Cards - Quicken Compare (2024)

FAQs

What is the downside of a balance transfer? ›

Cons of Balance Transfers

If you're not disciplined, a balance transfer can lead to higher debt. Once the balance is moved, you might be tempted to spend more on your old card, potentially leading to more debt than you started with.

In some cases, a balance transfer can positively impact your credit scores and help you pay less interest on your debts in the long run. However, repeatedly opening new credit cards and transferring balances to them can damage your credit scores in the long run.

You can avoid balance transfer fees by finding credit cards with no fees or introductory periods where no fees are charged. You'll have no transfer fees if you transfer your balance during the introductory period.

A balance transfer credit card is an excellent way to refinance existing credit card debt, especially since credit card interest rates can go as high as 30%. By transferring your balance to a card with a 0% intro APR, you can quickly dodge mounting interest costs and give yourself repayment flexibility.

Balance transfers come with certain costs and limitations, though. Generally, you'll have to pay a balance transfer fee — usually 3% to 5% of the total transferred. And if your balance transfer card's limit is low, you might not be able to transfer your full balance.

Card issuers typically have rules surrounding the amount of debt you can transfer in relation to your credit limit. Many issuers are generous, giving cardholders the ability to transfer their full credit limit, but in some cases, your transfer limit may be capped at 75 percent of your overall credit limit.

After a balance transfer takes place, your old account remains open. The original card issuer will typically only close your account if you make a request for it to do so. Unless you have a good reason to cancel your old credit card, however, you may want to think twice before you close the account.

A balance transfer credit card can be a useful tool if you're looking to pay off debt faster. If you get approved for a low interest rate and pay off your debt during the promotional period, you may be able to save money on interest and be debt-free sooner.

Avoid transferring a balance up to the new card's full credit limit. If you transfer a balance that either maxes out your new card or gives it a really high utilization rate, that could hurt your credit score. A maxed-out card can lower your score by more than 100 points, according to myFICO.

The best credit card with no balance transfer fee is the Navy Federal Credit Union Platinum Credit Card because it offers an introductory APR of 0.99% for 12 months on balance transfers as well as a balance transfer fee of $0.

How much will it cost in fees to transfer a $1000 balance? ›

It costs $30 to $50 in fees to transfer a $1,000 balance to a credit card, in most cases, as balance transfer fees on credit cards usually equal 3% to 5% of the amount transferred.

With some credit cards, you can request balance transfers while filling out the application before you're even approved. Phone. You can call your issuer to request a balance transfer. As with online balance transfers, come prepared with information about the debt you're looking to move.

It's generally recommended that you have two to three credit card accounts at a time, in addition to other types of credit. Remember that your total available credit and your debt to credit ratio can impact your credit scores. If you have more than three credit cards, it may be hard to keep track of monthly payments.

Consolidating Multiple Debts

0% balance transfer credit cards are a great way to consolidate debt because they allow you to move all of your debt onto one card with a 0% interest rate. This means you can pay off your debt without incurring any additional interest charges, saving you a lot of money.

As many as you want, as long as you stay below your credit limit. The best balance transfer credit cards give you between 60 and 120 days to transfer balances in order to qualify for the 0 percent intro APR offer, so try to transfer and pay down your balances as quickly as possible.

Balance transfer credit card mistakes may add fees or cause you to lose your 0% introductory APR. Common mistakes you should avoid include missing the transfer deadline, making new purchases at the standard APR and not having a repayment plan.

A balance transfer card is a great way to temporarily avoid interest charges while you repay debt. If you're aggressive with your repayment plan, you can manage to save hundreds or even thousands of dollars.