How To Transfer a Credit Card Balance

by Ryan Yates

transfer balance credit card

Could you save hundreds with a balance transfer?

So you’ve looked at your credit card balance and your high interest rate and you’ve decided that using a balance transfer credit card is the best option to save money on your road to debt reduction. Good for you!

I can’t overstate the importance of taking an active role in paying attention to and controlling your finances. Recognizing wasted money on high-interest credit cards is a great way to get back on track toward financial stability.

But how do balance transfers actually work? And which card should you use? These are important questions with answers that will help you make wise decisions about your debt balances.

The Balance Transfer Process

Find a Good Credit Card with a Solid Balance Transfer Offer – This step will take some research on your part, but finding the right card with the best offer is worth the time and effort. Check all of the details, read the fine print, and make sure you know what all of the fees are going to be before you apply.

Whatever card you’re researching, be sure to look for offers hovering around 0% interest for at least 12 months.

Depending on your credit score, you might not qualify for 0% interest, but don’t get too frustrated. A 5% offer is better than your current card at 17%. It would be smart to run a quick check on your credit score before you apply so you’ll know what to expect.

Apply for the New Card, but Don’t Transfer Just Yet – Once you find the credit card that has the best balance transfer offer, apply for the card and wait for you acceptance letter. You’ll have the option to ask for the transfer on your application, but my advice is to wait until you’ve got the new card before you make the transfer so you’re not surprised with an unfavorable rate.

Just because the credit card company is offering 0% interest, it doesn’t mean you’ll automatically qualify for that rate.

Ask for the Transfer – Once you’ve received your new credit card, ask for the balance transfer. You can do this over the phone, online, or through the mail.

Again, the reason I suggest waiting to transfer the balance is to make sure that 1.) you did actually get the new card, and 2.) you don’t get stuck with 2% or 5% when we were expecting 0% (this actually happened to me back in college).

Keep an Eye on Your Old Credit Card – Credit card balance transfers take time. Sometimes you’ll have to make one more payment on your old card even after you’ve initiated the transfer process if your payment due date on your old card is before the transfer has become official.

Also, don’t cancel your old card, but DON’T use it for purchases. The easiest way ruin your debt reduction plan is to treat your now balance-free credit card as a license to rack up more debt.

What about your experiences? Do you have any balance transfer success stories (or horror stories) that the rest of us could learn from?

Photo by Images_of_Money

{ 6 comments }

Choose Financial Freedom August 25, 2011 at

If I had an option to perform a balance transfer or a cash advance, I’d do the cash advance.

A cash advance doesn’t hurt your credit like a balance transfer. A balance transfer tells the bureaus that you’re just “moving money.”

A cash advance is where it’s at! All you have to do is

Cherleen @ yesiamcheap September 5, 2011 at

I wouldn’t do either of the two nor apply for a new card. If I see that I cannot afford to pay the balance on my card anymore, I would rather not use the card anymore or cancel the card and check for any payment plan that the bank can offer.

Ravi Chopra August 31, 2011 at

That’s cool. We don’t have any such thing in India. You cannot transfer your credit balance. Do you agree that credit cards can lead to unnecessary shopping?

Ryan Yates November 9, 2011 at

Credit cards DEFINITELY lead to more shopping and spending. They are financial disasters waiting to happen.

Damon Day September 6, 2011 at

Hey Ryan,
I like the layout of your site. I wanted to let you know that this article was included in the blog carnival I published 2 weeks ago. Not very many of the articles made my cut. Congrats 🙂

woodworking plans July 14, 2013 at

Wow, this post is nice, my sister is analyzing such things, thus I am going to tell her.

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