Keep Track Of Your Payments
Remember that the main reason most people want to complete a balance transfer is to pay off debt without accruing unnecessary interest. In order to do that, you’ll need to be smart and stay on top of your payments.
Make sure you keep track of exactly how many months you have to make the zero or low-interest balance transfer payments before a new APR kicks in.
Take the amount of debt you transferred and divide it by the number of months you have on the introductory APR. If you can pay that amount each month on your new credit card, you’ll be able to avoid paying interest while you pay down your debt.
Beware The Grace Period
People who take advantage of these offers sometimes find themselves on the hook for unexpected interest charges. The problem is that transferring a balance means carrying a monthly balance. Carrying a monthly balance by not paying off the minimum amount due each montheven one with a 0% interest ratecan mean losing the cards introductory APR, its grace period and paying surprise interest on new purchases.
The grace period is the time between the end of the credit card billing cycle and the due date of the bill. During that period a cardholder doesn’t have to pay interest on new purchases. But the grace period only applies if a cardholder is carrying no balance on the card. What many consumers dont realize is that carrying a balance from a promotional balance transfer can affect the grace period if minimum payments aren’t made each month.
With no grace period, purchases on the new card after completing the balance transfer rack up interest charges. One good change: Since the , credit card companies can no longer apply payments to the lowest-interest balances first; they now have to apply them to the highest-interest balances first.
Also bear in mind that many offers stipulate that the cardholder’s determines the actual number of months of 0% balance transfer in the introductory period.
The only way to get the grace period back on a credit card and stop paying interest is to pay off the entire balance transfer, as well as all new purchases.
How Do I Transfer Credit Card Balances To Another Card
You’ll need to tell the credit card company the name of the financial institution, the account number, and the amount you want to transfer. How much you can transfer depends on your available credit. If you’re approved for the transfer, the credit card company you’re transferring the balance to will contact your old credit card company and pay off the balance.
Transferring a balance doesn’t close your old account – it only pays portion of the balance transferred. After the transfer is complete you’ll begin making payments on the transferred balance under the terms and conditions of the transfer offer.
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How To Complete A Balance Transfer
Balance transfers can be completed in a few simple steps. The process varies a bit by card issuer, but is generally the same. The simplest way to complete a balance transfer is online. You can also complete a transfer over the phone by calling the number on the back of your card.
Here’s how to complete a balance transfer online:
Online Or Phone Transfers
The cardholder gives the account information and amount to the credit card company to which they are transferring the balance and that company arranges the transfer of funds to pay off the account.;If, for example, you are paying off a $5,000 balance on your high-interest Wells Fargo Visa card and transferring that balance to a Citi MasterCard with a 0% offer, you would provide Citi with the name, payment address, and account number for your Visa card, and indicate that you want $5,000 paid to that Visa account.
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Should I Transfer My Balance
Getting a card with a zero-interest introductory rate, especially if that teaser rate is good for 21 months, as some are, can save hundreds of dollars in interest and help you pay off your balance much sooner.;As long as youre not seen as risky by creditors, there may be some good balance transfer offers available to you.
Here are some signs a balance transfer might be a good fit for you:
- You have a better paying job after a period of unemployment or underemployment and youre ready to lower your debt.
- Youve committed to stop overspending and youre ready to create a plan to pay off your debt.
- Your credit rating is good to excellent and you think you may be able to qualify for a new card with an attractive balance transfer offer.
Unfortunately, if you have poor credit scores or youre going through a period of financial distress, you may not be able to qualify for a new credit card with favorable balance transfer terms. If this describes you, you may need to consider other options like or perhaps even bankruptcy.
Its up to you to decide whether a balance transfer offer is wise in your situation. Like many tools in your financial toolbox, this one is sharp. Develop a strategy for using it to get what you want and wield it with a healthy supply of discipline.
Selecting A New Balance Transfer Credit Card
- If none of your existing credit cards can match the balance transfer APRs and duration from your preapproved offers, then opening up a new balance transfer credit card may make sense.
- Most balance transfer offers will include introductory 0% APR for balance transfers for a set period of time. No interest will accrue on the balance transfer amount during that introductory window. These can be very appealing offers, especially when you are planning to aggressively pay back that transferred debt during that introductory window.
- Be aware, however, of what the APR will be when the introductory window expires: these APRs may be much higher than your current APRs, so you will want to be certain that you have reduced the debt enough so that your interest charges don’t increase after the introductory period closes.
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Low Intro Apr For 21 Months On Balance Transfers And 12 Months On Purchases
Get ahead with;0% Intro APR for 21 months on balance transfers and 12 months on purchases. After that the variable APR will be % – %, based on your creditworthiness.*
Rated 4.3 out of 5 Stars
Ratings are based on 5,311 cardmember reviews between 4/6/2016 and 2/28/2021
0% Intro APR on balance transfers for 21 months from date of first transfer.;
After that, the variable APR will be % – %, based on your creditworthiness. All transfers must be completed in the first 4 months.
0% Intro APR on purchases for 12 months from date of account opening.;
After that, the variable APR will be % – %, based on your creditworthiness.
If you transfer a balance with this offer, interest will be charged on new purchases and unpaid introductory balances after your 0% introductory APR on purchases expired unless you pay the entire balance in full each month by the due date.
There is a balance transfer fee of $5 or 5% of the amount of the transfer, whichever is greater.
How Can I Choose A Money Transfer Credit Card
If your current card does not offer a money transfer facility, you can compare and find money transfer cards with Uswitch.
It is worth comparing cards to find the best money transfer credit card for your needs. This will depend on how much money you want to transfer into your bank account, how long you need to borrow the money from your credit card, and how you plan to pay the money back.
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Best Balance Transfer Credit Cards Faq
Comparing balance transfer credit cards can be tough. But youve got the knowledgeable WalletHub community on your side. We encourage everyone to share their knowledge while respecting our content guidelines. Please keep in mind that editorial and user-generated content on this page is not reviewed or otherwise endorsed by any financial institution. In addition, it is not the financial institutions responsibility to ensure all posts and questions are answered….show moreshow less
Can I Transfer Money From My Credit Card To My Bank Account
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Sometimes people need cash for a last-minute or unexpected expense after all, things happen. You might be wondering if you can withdraw cash from your credit card to cover the cost, especially if the amount is only a couple hundred dollars. It is possible to transfer money from your credit card to your bank account through something called a cash advance transaction. While cash advances are not the most ideal option when you need quick cash, sometimes they are the best or only option. If youre unsure of what a cash advance is, or simply want to learn more, continue reading below.
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What Is The Difference Between Joint
The difference can impact your balance transfer options and your legal rights when transferring or sharing debt.
| Joint-primary cardholder accounts | Primary cardholder accounts with secondary cardholders |
|---|---|
| Two people have applied for a credit card under both cardholders names and have complete access to the account. | One person has applied for a credit card in their name but wants to share the account with a partner . |
| Both have the ability to change credit limits, request account freezes or close the account. | Primary cardholder can request to add a secondary or additional cardholder but only the primary cardholder has control over credit limit changes, account freezes or account closure. |
| Both partners have regular sources of income and good credit histories. | Only the primary cardholder has to have a regular source of income and a good credit history. |
| Both parties remain liable for all transactions and payments made on the card. | Primary cardholder remains liable for all transactions and payments made on the card, even if a balance has been transferred from an account held by the secondary cardholder. |
| If the closure of an account is the result of a divorce or a separation, both partners might have to pay half of the debt each, no matter who made which purchases. | In the event of a separation or a divorce, know that you, as the primary cardholder, would be liable to make payments toward the entire account. |
How To Do A Credit Card Balance Transfer
How do credit card balance transfers work? After getting approval for a card with a 0% interest balance-transfer offer, find out whether the 0% rate is automatic or depends on a credit check. The next step is determining which balances to transfer; cards with high interest rates should come first.
Next, calculate the transfer fee, which is typically 3% to 5% . Is there an amount cap on the fee? If not, that can make transferring larger balances worthwhile. Also check the on your new card before you initiate a transfer. The requested balance transfer cannot exceed the available credit line, and balance-transfer fees count toward that limit.
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How To Transfer Your Credit Card Balance
If you are working to reduce your credit card debt, a balance transfer to another credit card can be an effective way to reduce your interest payments as you reduce your credit card balances.
There are two things to consider as you consider a credit card balance transfer:
Be careful that you are not transferring a balance to a credit card that has a higher APR than your original card, and
Don’t plan to use low introductory APR balance transfer offers over and over to put off paying back your debts.
With that in mind, moving debt to different cards can help keep your credit card interest payments at manageable levels, help you focus your funds on paying off your credit cards, and build healthy credit habits that can help increase your credit score. Here are the steps to take into account when you transfer your credit card balances:
Know your existing credit card’s interest rates, balances, and balance transfer limits
Weigh your available offers against your existing cards’ offers
Select the card with the best balance transfer offer available to you
Transfer your balances to the card with the best offer or your new card
Pay down your credit card debt
Examples: Two Simple Balance Transfer Scenarios
Here are two simple examples that show how a balance transfer might save you money.
Imagine you owe $1,000 on a credit card with a 20% APR. Unfortunately, youre only able to pay $30/month toward the debt.
If you pay only $30 every month and dont spend any more on the card, it would take over 4 years to pay off the entire balance. In that time, youd also be spending over $470 in interest on what was originally a $1,000 balance! When you only pay the minimum required on a card, most of what youre paying is interest. Paying the minimum payment can make it feel impossible to make a dent in your debt.
Learn more about how paying a credit card and minimum payments work here.
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Know The Limits On Your Balance Transfer
Some balance transfer cards put a hard limit on the amount of debt youre allowed to transfer.
There could also be limits on when you have to transfer your balances to qualify for the introductory 0% balance transfer APR offer. If you miss that transfer window to receive the introductory APR, you could end up paying more in interest than you do on your current cards. Check out the fine print on any offer to read up on the restrictions on your offer they may not be listed anywhere else.
What To Look For In A Balance Transfer Card
Balance transfers can save money. Say you have a $5,000 balance on a credit card with a 20% annual percentage rate . At that rate, carrying that balance and paying $250 a month would require 24 months to pay off and cost $1,134 in interest. After securing a 12-month 0% balance transfer on a new credit card and moving the $5,000 balance, the cardholder gets a year to pay it off with no interest and just a fee to transfer the balance.
But details and surprises with these transfers are numerous. After the transfer, for example, you still have to make the minimum monthly payment on the card before the due date to keep that 0% rate. And pay attention to the interest rate. Does the new card have a regular interest rate thats higher than the interest the balance incurs on your current card?
Similarly, a default under any of the rules of the cardholder agreementsuch as making payments late, exceeding the credit limit, or bouncing a checkcan make the interest jump to a;penalty rate as high as 29.99%. The 0% rate is usually valid for 12 or 18 months, sometimes more. Can you pay off the transferred balance during that period? If not, what interest rate kicks in afterward?
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What Is A Credit Card Balance Transfer
You might have heard the term balance transfer credit card, but a more accurate description is credit card offer favorable to balance transfers.
Pretty much any credit card will let you transfer a balance away from it. Many credit cards will let you transfer a balance to them as well.
Some credit cards, however, have terms that are more favorable for incoming balance transfers. These may include:
- Lower fees on incoming balance transfers
- Lower regular interest rate on balance transfers
Transfer Your Balance To The New Card
If these requests are approved, the provider of the new credit card pays off the debt on consumers existing cards. That debt is then charged on their new card.
As noted, most card providers will charge a fee, often in the range of 3% to 5% of the amount of money youve transferred. If youre transferring $6,000 of credit card debt and the fee is 3%, youll pay $180 for that transfer, a figure that will be added to the balance of your new credit card.
Depending on the credit limit of your new card, you might not be able to transfer all your existing credit card debt. If your new card comes with a credit limit of $10,000 and you have $15,000 of credit card debt, youll only be able to transfer over a portion of your debt.
Finally, you wont be able to transfer your debt between two cards issued by the same provider. For instance, you cant close a balance transfer between a Citi® Double Cash Card and a Citi® Diamond Preferred® Card even though both cards offer balance transfer promotions.Balance transfer processes and policies may differ among the major issuers. See below to find out how each credit card company handles balance transfers.
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