![]() ![]() Balance transfer fee (5%): This is the one-time fee associated with each balance transfer.Introductory 0% APR balance transfer term (60%): The most heavily weighted factor in our rankings was the length of time that the introductory 0% APR on balance transfers lasts.We ranked each account in these six core categories: To bring you our top picks for the best cash back credit cards, the Fortune Recommends team compared more than 30 balance transfer cards available from major issuers. Second, you should pay off your entire balance before the introductory APR is over, otherwise you will start accumulating interest at the regular purchase rate. However, this fee is usually worth the interest savings. The first is that in most cases, you’ll be required to pay a fee of around 3% to 5% when you transfer a balance. There is no catch with balance transfers, but there are a couple of important points to be aware of. Is there a catch to balance transfer cards? Transferring the balance to a new card with a low or 0% APR can help you pay down the debt faster without the added burden of accrued interest. Is a balance transfer ever a good idea?Ī balance transfer can be a good idea if you have a high-interest credit card with a significant balance. ![]() However, if you continually open new credit cards and transfer debt around without paying it down, your score can be harmed in the long run. Frequently Asked Questions Do balance transfers hurt your credit score?Ī balance transfer itself should have a negligible impact on your credit score. You’ll need to provide a few details, including the card numbers and amounts you want to transfer from each account. This can often be done online through your new credit card account or by calling the card issuer. Key factors to consider include the length of the introductory 0% APR period (if there is one), the regular APR after the introductory period ends, and the balance transfer fee.Īfter your application is approved and you receive your new card, you can initiate the transfer. Start by comparing your options and look for a card that offers favorable terms. If you find a credit card offering an introductory 0% APR on balance transfers, this can be a great opportunity to pay down your debt without accruing additional interest during the promotional period. It also makes it easier to pay off your debt faster since 100% of your payments go toward the principal balance. If you have high-interest credit card debt, transferring the balance to a card with a lower interest rate can save you money. Before transferring a balance to a new card, be sure to check the fee and APR for balance transfers and understand how long the promotional rate applies. For instance, if you transfer $10,000 and the fee is 3%, you would pay a one-time cost of $300.Īlso, keep in mind that while some balance transfer credit cards offer a 0% introductory APR for a set period (usually around 12 to 18 months), if you don’t pay off the transferred balance within that period, you will start accruing interest at the card’s standard rate. Most credit card issuers charge a balance transfer fee that typically ranges from 3% to 5% of the amount being transferred. How much does it cost to do a balance transfer? If you are looking to make a large purchase, check out our list of Best 0% APR cards. 0% APR on purchases allows you to finance a large purchase for a longer period of time without interest. What is the difference between 0% APR on purchases and a balance transfer?Ī balance transfer happens when you take the balance from a higher-interest loan and transfer it to a card with a lower interest rate. Learn more about how balance transfers work. Cardholders generally choose to transfer a balance in order to consolidate high-interest credit card debt and reduce the amount of interest being accrued, allowing them to save money and pay off the balance faster. In order to attract new business, some cards may even offer an introductory 0% APR on balance transfers. What is a balance transfer?Ī balance transfer involves moving the outstanding balance from one or more credit cards to another credit card, usually with a lower interest rate. Members of the Bank of America Preferred Rewards program enjoy many other exclusive benefits and pricing discounts as well. Preferred Rewards members earn 25%-75% more cash back on every purchase, which translates to a cash back rate of 1.87% to 2.62%. ![]()
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