Many start the new year with a resolution to get out of debt. Mailboxes are flooded with all sorts of offers to help you in this regard. Credit card balance transfer offers allow you to move debt from one (or more) credit card to a different credit card, often at special rates and terms that last for a limited-time.
While this could be a good option for consolidating debt, there are several points to consider before you accept a balance transfer offer.
Balance transfer fees
A balance transfer fee is a one-time fee paid when you transfer a balance. It is important to know what the transfer fee will be before you accept the offer. Some balance transfer offers come with no balance transfer fees, which could be better for your bottom line.
Introductory rates and terms
Many credit card companies offer a low or 0% introductory interest rate for balance transfers, which reduces or eliminates monthly finance charges on your balance transfer for a certain term. This can help you pay off your credit card balance faster because your payments are going directly to principle. After the introductory term, often six months to a year, the card’s interest rate generally returns to its regular rate. It is important to make sure you are comfortable with the card’s interest rate once the introductory rates and terms expire.
Annual fees are one of the most common credit card fees. Ranging from $25 to $500, annual fees are automatically charged to your account once a year. Be on the lookout for cards with no annual fee.
Credit card balance transfer offers can be a great way to consolidate debt and helping you save money on interest. Shop for an offer with confidence by fully understanding the rates, terms, and conditions of the card.
This article is for general information only and not intended to provide specific advice or recommendations for any individual.