Credit card debt in the U.S. was nearly $890 billion for the first quarter of 2020 — that’s a staggering number. Not to mention that the average credit card holder carries an outstanding balance of more than $6,000 month-to-month. Balance transfer cards come in handy when paying off high-interest balances, saving you a fortune in interest. But there are drawbacks.
What are balance transfer cards?
A balance transfer credit card is much like any other credit card. It typically comes with a lower interest rate or 0% introductory rate and can save you hundreds of dollars in interest over months. That makes it a practical money-saving option to pay off high-interest debt at a lower interest rate.
The best balance transfer cards have low balance transfer fees, no annual fees, and long introductory APRs — from 12 months up to 24 months. Some credit card companies charge balance transfer fees and other charges, so visit Credible to find the right balance transfer card for you.
Balance transfer credit cards allow you to consolidate your debts by moving account balances to the card. But it can cost you more in the long run if you don’t pay off your balance as quickly as possible, if you make late payments, or miss a payment.
- A balance transfer of credit card is a credit card that offers a promotional 0% APR.
- It is a practical way to chip away at balances on high-interest credit cards.
- Some balance transfer cards charge high fees.
- There are limits on the amount you can transfer.
Is there a limit on balance transfer cards?
You’re given a credit limit when you apply for a new balance transfer credit card. This credit limit, which varies from one lender to the next, directly impacts just how much you can transfer.
Generally, card issuers limit a transfer to a percentage of your credit limit or sometimes to a specific dollar amount. They take a look at your credit history at the time you apply to determine your limit. Use Credible to see multiple balance transfer card options from credit card companies — all in one place…Read more>>