What’s a balance transfer?
A balance transfer allows a person to move the debt built up on one credit card to another.
The process can be particularly useful if you are transferring the debt onto a card with a lower interest rate or even one with an interest-free period, as such a move will mean you may be able to pay it off quicker. A balance transfer can help to consolidate a range of monthly payments and ultimately improve how you manage your finances.
It is worth bearing in mind that banks will often charge some level of fee on balance transfers. Furthermore, some cards may only offer a favourable rate for a certain period of time before it then increases to a significantly higher level.
What’s a balance transfer? transcript
What’s a credit card balance transfer? It’s where part or all of what you owe on your current credit card is transferred to another credit card, usually with a lower interest rate. Fees can apply with balance transfers, so check beforehand.
Time to transfer some of that coffee into my mug.
How long do special interest rates on balance transfer cards last?
The range of deals on offer can vary from bank to bank with some offering 0% for up to three years. You should always carefully check the fine print to understand what you may be signing up to and whether you will be able to clear your debt during the low or 0% rate period.
Can you make purchases on balance transfer cards?
This again can vary and will be dependent on the terms and conditions that you have signed up to. It is not uncommon however for some balance transfer cards to charge interest on purchases, so the issue is certainly one to take care on.
Will I be charged for a balance transfer?
A fee is often charged on a balance transfer so you should factor this into your thinking when you are deciding which deals may be right for you. However, you may also find some options that charge no fees at all. It all depends on what you’re looking for.
What happens if I miss a repayment on the balance transfer card?
Missing a payment is something you should try your best to avoid, as it could mean you lose the low or 0% rate you were offered while you face other unwanted charges.
Why is the 0% period on my balance transfer card shorter than advertised?
Some balance transfer cards may be advertised as offering ‘up to’ a certain period as interest-free. In such circumstances, those with a lower credit score may not access the full deal but instead may be offered a shorter period on the special rate.