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Compare Balance Transfer Credit Card Offers
Updated: September 5, 2017
|| 0% Intro BT APR Period
|| Balance Transfer Fee
|| Our Savings Estimate
|| Regular APR
| Citi® Diamond Preferred® Card
|| 21 months
|| 13.99% - 23.99% Variable
| Citi Simplicity® Card
|| 21 months
|| 14.99% - 24.99% Variable
| Discover it®
|| 18 months
|| 11.99% - 23.99% Variable
| Citi® Double Cash Card
|| 18 months
|| 14.49% - 24.49% Variable
| Chase Freedom Unlimited®
|| 15 months
|| 15.99% - 24.74% Variable
| Chase Freedom®
|| 15 months
|| 15.99% - 24.74% Variable
| Wells Fargo Platinum Visa® Card
|| 18 months
|| 3.00% Intro
|| 16.15% - 25.99% Variable
| JetBlue Card
|| 0% for 12 months (on balance transfers made within 45 days of account opening)
|| 12.99%, 20.99% or 25.99% Variable
| Wells Fargo Cash Wise Visa® Card
|| 12 months
|| 3.00% Intro
|| 13.99% - 25.99% Variable
A balance transfer can be a great way to consolidate payments and avoid interest if you're carrying a balance. With the right card, you can even reap rewards and benefits after you pay off the transferred balance. If you know how these offers work, and you know what other perks to look for, you can find the best balance transfer card to minimize your interest and maximize your rewards.
If you're not familiar with balance transfers, our balance transfer card reviews will help you discover what the details of each card are, and show you what rewards are worth.
What is the meaning of balance transfer?
A balance transfer means you transfer the balance from one credit card to a card typically with a lower interest rate. Let's say you have $3,000 on Card A with a 17% APR. That means if you pay the minimum amount, it will take you 126 months and you will pay $2,241 in interest. If you transfer that $3,000 to Card B, with an introductory 0% APR for 18 months, that means you have 18 months to pay off the balance without paying interest fees, thereby potentially avoiding the cost of $2,241. Balance transfers are also an option if you want to streamline your payments. Simply transfer your balances to a single card and make one payment a month.
What is a balance transfer card?
A balance transfer card is a credit card that consumers typically use to avoid paying a higher interest fee. The balance on Card A is transferred to Card B, which may have a low or 0% introductory APR. Credit card companies will sometimes attract new customers with little to no interest for a set period, sometimes as long as 21 months, such as the Citi Simplicity. Balance transfer cards may also have a 0% introductory APR for purchases. For example, the Simplicity has an introductory 0% APR of 21 months for purchases. Each credit card specifies which balances will be paid first typically starting with the lowest–rate balances. Some balance transfer card rules specify that only transferred balances qualify for the lower rate, while new purchases collect interest at the regular, higher APR.
What is a balance transfer fee?
A balance transfer fee is the charge for transferring a balance from one credit card to another. The more you transfer, the larger the fee. A typical fee is 3%–5%, with a minimum of $5 or $10. For example, if you transfer a $10,000 debt from another card, you might pay a $300 fee right away. While that expense may seem hefty, assess whether you will actually save by transferring to a 0% introductory APR card to avoid interest fees, because you can easily spend thousands on interest fees. However, make sure you will be able to pay off the debt by the time the introductory offer ends, because the new card will likely revert to a go–to APR that can be 15% or more. See if it makes sense for you by using our balance transfer calculator.
Keep in mind that some balance transfer cards don't have balance transfer fees, such as the Barclaycard Ring Mastercard.
What is a balance transfer intro period?
A balance transfer introductory period refers to a low or 0% APR offer a credit card issuer provides for a limited period of time as an incentive to become a cardholder. A cardholder can pay down debt transferred from another card while not paying interest for the debt for an introductory period of time. A balance transfer intro period can last up to 21 months. After the set period, the interest rate can increase to a “go–to rate” of 15% or more. You should make sure you evaluate the balance transfer interest rate during the promotional period, the length of the promotional period, and the balance transfer fee when deciding which balance transfer offer is best for you.
What is balance transfer intro APR?
An introductory APR period is the amount of time you have to pay off the amount you've transferred without paying interest. A 0% APR period can last up to 21 months. Most balance transfer cards, with a few exceptions, charge you to move your balance. Generally, this fee is a percent of the balance you're transferring ranging from 3% to 5% depending on the card or $5–$10, whichever is greater. Since most cards' default rate can be higher than the rate you had on your old card, paying off your debt within the 0% period is crucial. Read the fine print, as some cards will void the 0% deal if you miss a payment.
How does a balance transfer on a credit card work?
Transferring the balance from one credit card to a card with a lower APR is referred to as a balance transfer. It should be noted that transferring isn't the same as repaying. When you use a balance transfer card, you are transferring the debt from Card A to Card B. Then, if Card B has an introductory offer, you can typically have a set amount of time, up to 21 months, to pay off the debt without paying any interest fees, although there can be a balance transfer fee. Other reasons to transfer a balance can be to consolidate your debts. However, avoid closing a credit card account, because having available credit helps your credit rating. So, if you transfer debt from Card A, now you have a card without any debt, which increases your credit utilization ratio (the ratio of your available credit to how much you owe). The lower the ratio, the better. That means if you keep Card A open, your available credit is boosted, and your ratio is lower. Also, Card A's payment history can help your credit. Just be sure to keep Card A's account active by charging a small monthly amount, and pay it on time and in full each month.
Are credit card balance transfers a good idea?
Transferring a credit card balance can be a good idea if you've incurred card debt and you are paying the minimum monthly amount. That can translate to high monthly APR fees that can be avoided if you transfer your debt to a card with a 0% introductory APR. However, make sure you have a plan to pay off the debt before the introductory offer ends, because balance transfer cards typically have a “go–to” rate that can be 15% or more once the offer ends.
Another good reason for transferring a card balance is consolidation. If you have debt on multiple cards, and you want to avoid the hassle of multiple payments, taking out a good balance transfer card can be wise. However, get to the root of the problem. Why do you have debt on multiple cards? If you are using your credit cards to buy items not in your budget, the problem may not be the cards. It may be your spending habits.
Also, taking out a new credit card to transfer a balance can be a bad idea if you are planning to take out an installment loan (a car loan or a mortgage) in the coming months, because lenders look for “hard pulls” or evidence of recent requests for credit. If you plan to buy a car or house soon, weigh whether any card debt you have could impact your application with whether lenders would be concerned about new cards. When in doubt, check with your lender before making any financial move.
Do balance transfers help your credit?
A balance transfer can certainly improve your credit – in the long term. A number of aspects of your credit score come into play when you transfer a balance to a new credit card, notably your payment history, which is your history of on–time payments, and your credit utilization, which is your available credit compared to your debt. To a lesser extent, the length of your old card's history and taking out a new card can also impact your credit. Here's how:
The most important (and most obvious) factor in play during a balance transfer is the opportunity to establish a better payment history. Payment history makes up 35% of your FICO score, the scoring model most used by lenders. Transferring debt from a high interest account to one with a 0% APR into period can significantly lessen the burden of maintaining a monthly payment schedule. You may have to pay a lump sum upfront in the form of a transfer fee, but the money you will save on interest can more than make up for it over time. If you pay more than the minimum amount and establish a plan to pay off the transferred balance before the introductory period expires, you will be debt–free years before you would if you pay the minimum. This will both save you money and improve your financial responsibility in the eyes of future creditors.
Along with an improved payment history, balance transfers can boost your credit by lowering your credit utilization (limit–to–balance) ratio. In fact, the second most important part of your FICO score is amount owed, at 30%. The credit utilization ratio is a measure of the debt you owe in comparison to the credit limit available to you. If you keep the old, paid–off card, that automatically boosts your ratio, because you have available credit with no debt. However, don't incur any additional debt once the new credit line has been established, or you'll defeat the purpose of building credit and get yourself back in your debt predicament.
Length of Credit History
Some 15% of your FICO score is made up by the length of credit history. And that's another great reason to keep your old card, so that you continue building your time with an older product.
Some 10% of your FICO score is made up by new credit in your file. That's actually a reason to pause before taking out a balance transfer card – a new credit product can ding your rating, albeit not by much. Just be deliberate about your card choice, and make sure you don't have plans to take out an installment loan (car loan or mortgage) in the coming months, because lenders will be looking for any new products when they review your file.
Credit Mix in Use
The remaining 10% of your FICO score encourages a mix of credit products, such as credit cards and installment loans. For this reason, don't take out a balance transfer card without a plan, but a new balance transfer card can help your credit by allowing you to consolidate and to help you pay down your card debt.
Are balance transfers bad for your credit?
Used incorrectly, balance transfers can be bad for your credit. Used right, it can be great for your credit. Here's what you need to know:
- When you apply for a balance transfer credit card – or any type of credit – it dings your credit. As a result, your credit score will drop by a few points. But if you plan to use the card to get your debt under control, that benefit can outweigh the disadvantage of those few lost points, which will be recovered within a few short months of good payment habits.
- Planning to cut loose of that old card that has been weighing on your credit soul? Hold up, because a paid–off card with good credit payment history is credit gold. Here's how: First, the FICO scoring model likes it when you have a lot of available credit, but not much debt. So, if you keep the old card, you've increased your available credit when you take out the new card, and your percentage of debt goes down because of that additional available credit. Second, FICO loves credit accounts with a history of on–time payments, so it's worth your while to hang on to that card.
- You've made the right decision to keep your old card, but you plan to lock it up in a sock drawer. Stop! By not using your old card, you run the risk of letting the account lapse, and that payment history clock stops. Keep using the card each month, but responsibly. More on that later.
- Although you need to keep using your old card, you don't want to incur additional debt, because then your credit utilization ratio – remember the debt to available credit percentage? – will be too high. Here's what to do: Put a small monthly charge you would have anyway, such as your gym membership, on auto debit. But be sure to pay in full each month.
- In some cases, making a payment even a single day late can cause the issuer to cancel your 0% APR period and leave you immediately subject to the high interest rates you sought to escape in the first place. Also, this will affect your payment history, so be sure to pay on time, or your credit will be surely affected.
Things to consider before applying for a balance transfer card
Balance transfer credit cards are a great way to improve your credit, used correctly. Used incorrectly, these cards can wreak havoc on your credit.
There are 5 things to consider before applying for a balance transfer card.
Can I withstand the credit score effects?
Applying for a new card requires a hard inquiry, which will temporarily drop your credit score. This can be recovered rather quickly and is generally not cause for worry. However, if you plan to take out an installment loan in the next few months, such as a car loan or a mortgage, these slight dings impact the interest rates or even whether you can land the loan of your choice. If your new card is the only credit you have on the horizon, then the drop in points will be temporary and relatively harmless, provided you continue to pay on time and keep your debt down.
What is the available credit limit?
The credit limit should be sufficient to cover the desired transfer amount without maxing out the new account. This way, you can take maximum advantage of the lower interest rates and improve your credit utilization ratio simultaneously. This ratio looms large for the FICO scoring model, the model most used by lenders. It is the amount of available credit you have compared to the amount of debt you have. The lower the percentage of debt, the better. That means the higher the new card's limit, the better, because any credit you aren't using counterbalances your debt.
How much is the transfer fee?
Low interest or 0% intro APR transfer cards usually require a transfer fee that typically ranges between 3% and 5% of the balance or $5–$10, whichever is greater. In most cases, this fee is minuscule in comparison to the interest charges you would otherwise pay and is therefore a good tradeoff. However, if the balance is low enough, it may not be worth paying the transfer fee in the first place. It's also worth noting that some card issuers waive the balance transfer fee, such as the Barclaycard Ring Mastercard.
How long is the introductory APR period?
The appeal of a balance transfer card comes in the form of a low or 0% intro APR, but these rates don't last forever. These teaser rates can be for up to 21 months, such as the Citi Simplicity. Look at all the card's benefits, though, because some cards have a shorter intro APR, such as the Blue Cash Everyday, yet they offer an introductory cashback offer and cash back for such purchases as groceries and gas. (Terms apply.) Think about how you'll use your card in the long haul. That said, make sure you only use such a card for purchases you can afford to pay off and after the balance transfer is paid so that you don't return to the cycle of debt you're trying to escape. Some cards, such as the Blue Cash Everyday, have a 0% intro APR for purchases as well.
Can I stay disciplined throughout the process?
Be true to yourself. If not, you could only worsen your existing situation. If you struggle with making monthly payments on time or don't trust your ability to cease acquiring debt, having another card at your disposal is probably not the best option. In fact, you may have difficulty even getting a new card if you have a history of late payments. Conversely, if you feel you are responsible enough to stick to the plan you have set for yourself, a balance transfer can bring you budgetary glory. If you think you can keep the old card active without incurring new debt, and you can pay down your new card without buying new items, a balance transfer card could be right for you.
How to select the right balance transfer card
Looking to land a balance transfer credit card? Here's how to select the right one for you:
- Required credit score
Even rejected applications require a hard inquiry and will ding your credit. Make sure you are within range of the card issuer's required credit. For a card that requires good credit, you need a FICO score of about 700 on a scale of 300–850. The higher the score, the more likely you'll land the card, although other factors also play in, such as multiple inquiries and wages. If you have your eye on a card that requires excellent credit, plan to have a score of at least 760, possibly more.
- Sufficient credit limit
The available credit line should be substantial enough to cover the sum you're looking to transfer. Ideally, you would like to have a credit limit that allows for a full transfer and some breathing room. The higher your limit, the better, not because you can spend it, but because you won't. If you have air in your limit, or available credit that isn't being used, that can help boost your credit score.
- Balance transfer fee
Most balance transfer cards have a transfer fee of 3%–5% or $5–$10, whichever is greater. But some, such as the Chase Slate, offer for an introductory period of no transfer fee.
- Lengthy introductory period
Balance transfer cards will offer low or 0% intro APR for up to 21 months. Use our handy–dandy payoff calculator to see how much time you need to pay each month and pay off the balance before the introductory offer ends. You don't want to get into a situation where you still have a balance when the offer ends, so choose wisely.
- Reasonable ongoing APR
While you don't want to have a balance remaining when the introductory offer ends, pay attention to the go–to APR rate, which is the interest rate your account will revert to once the offer ends. Ultimately, the go–to rate shouldn't matter, because you are paying your card bill in full and on time each month (right?), but it's good to pay attention to the details, just in case.
- Annual fee
On the surface, you want a card without an annual fee, right? But annual fees are sometimes waived the first year, and the benefits of a card (such as cash back on a Blue Cash Preferred) can make the annual fee worthwhile. Think in the long term about how you plan to use your new card. If you solely want it for the introductory APR offer, you don't want an annual fee. If you plan to make it your go–to card once the balance is paid off, expand your horizons and look at balance transfer cards with bonus signup points or cash back and other perks.
- Acceptable terms & conditions
There are usually conditions that must be adhered to in order to take full advantage of the balance transfer. For example, an issuer will likely require a transfer to be completed within a specified amount of time to lock in the offered rates. In other cases, the introductory APR may be nullified if you are late on a single payment and the regular APR could kick in immediately. ALWAYS read the fine print!
How do you transfer a balance from one credit card to another?
Transferring a balance from one credit card to another is pretty straightforward.
Simply place a call to the new creditor's customer service line. Communicate that you would like to transfer a balance onto your new card and a representative will guide you from there. You may also accomplish this online, though the exact procedure will vary depending on the bank. Heads up that you will likely have to pay a balance transfer fee, although some cards do not charge one, such as Barclaycard Ring Mastercard. Also, make sure you get terms with the new card that will allow you to pay the debt in full by the end of the introductory offer. So, if you owe $3,600 and the offer is 0% APR for 12 months, that means you need to make sure you can pay $300 a month for a year. That way, you don't pay interest rates on the balance.
How long does it take to transfer a balance from one credit card to another?
Generally, a balance transfer can be expected to clear within 7 days of the request being placed. However, the exact amount of time it will take varies and is dependent on a number of issues. Many people report that their balance transfers have been accomplished in under 48 hours while others have complained of a transfer taking upwards of two weeks to complete. Unfortunately, there's no clear–cut timeline.
In order to better gauge how long a transfer will take, consider the following factors:
- Account Age
If your account with the receiving creditor has been active prior to the transfer request, it will likely complete more quickly than with a newly opened account.
- Transfer Process
If the money can be transferred electronically to the creditor, it will often take less time than payment via physical check.
- Balance Amount
Large balances may take longer to complete, whereas balances of less than a specified amount could be fast–tracked in accordance with issuer policy.
Simply, some banks just have a better reputation when it comes to completing balance transfers. Chase and Citi are two that come to mind.
- Application Method
If possible, submit your application online to ensure quality control; information relayed over the phone is subject to being misunderstood or incorrectly entered.
- Time of Request
Is it close to the weekend? Are there any major holidays coming up? If so, the process might be delayed until normal business resumes.
Can you transfer a balance from one card to another from the same bank?
Typically, a bank does not allow a balance transfer between two cards it has issued. That's because it doesn't make good business sense for the financial institution. After all, banks and card issuers operate to make money on the debt you owe and a balance transfer represents a means of saving the cardholder money on that debt.
That said, the structure of a balance transfer exists as a win–win for all parties involved when the debt is being transferred from one creditor to another, as it is almost always done. This way, both parties are satisfied for the following reasons:
- The new creditor takes on an existing debt but, more importantly, gains a new customer.
- The customer pays a relatively modest transfer fee (typically 3% to 5% of the balance) but saves money in the long run by taking advantage of the 0% intro APR period and lower interest rates.
How to properly use a balance transfer card
Here are tips to properly use a balance transfer card:
- Cease applying for new cards
Once you get a balance transfer card, don't take out any more cards. Every time a card issuer checks your credit, which is done when you apply for a card, that dings your credit rating. A cluster of inquiries may paint you as being financially unstable. Also, additional cards only increase the temptation to spend.
- Keep existing accounts open
The average age of your accounts is taken into consideration when determining your creditworthiness. Therefore, keeping older, established lines of credit active following a transfer only helps your credit rating. It will also help you obtain a more admirable credit utilization ratio, which is the second most important factor taken into account by lenders. The ratio compares the available credit to the amount owed. The closer to 0% the better. Finally, charge a small amount on your old card that you would spend anyway, and pay in full and on time each month. That keeps your account active, and it will actually help build your credit in no time.
- Stick to your payment plan
By now you should have planned out a strategy that will allow you to pay off the full balance before the introductory period runs out. This includes budgeting for any necessary fees, determining how much you will need to pay each month and identifying all stipulations that must be observed as part of the balance transfer agreement.
- Stop incurring additional debt
Quit adding to the problem. After all, there's a reason you sought a balance transfer in the first place. Halting charges on both the old and new accounts will save you from paying on the interest rates you fled and will make it much easier to abide by your payment schedule if the remaining balance isn't in constant fluctuation. Also, when you make new purchases, you run the risk of incurring interest fees, even while you are trying to pay off your old debt.