transfer credit card balance

 

How does a balance transfer work?

Balance transfers move outstanding debt from one credit card to another, usually with significantly lower promotional interest rates and better benefits.

Balance transfer works like this:

transfer credit card balance

After you're approved for a card with a 0% interest balance transfer offer, find out if the 0% rate is automatic or subject to a credit check.

Determine which balances to transfer; Credit cards with high interest rates should be prioritized.

Estimate transfer fees, typically 3% to 5% ($30 to $50 for each $1,000 transfer). Many credit card issuers will waive this fee and offer a promotional or introductory period of about 6 to 18 months.

How to transfer credit card balance?

There are 6 easy steps to transfer a credit card balance:

Step 1: Check your current credit card balance and interest rate.

Step 2: Apply for a balance transfer card.

Step 3: Request a balance transfer.

Step 4: Transfer the balance to the new credit card.

Step 5: Wait for the transfer to go through.

Step 6: Pay off your credit card balance.

Step 1: Check your current credit card balance and interest rate

The first thing you should do is check your current credit card balance and interest rate. The interest rate on your credit card is usually expressed as the annual percentage rate, or APR.

Your goal is to choose a balance transfer card that accepts the amount you want to transfer and has a lower interest rate than what you're currently paying on your debt.

Apply for a balance transfer card

You can apply online for a balance transfer credit card within minutes after comparing and choosing the best one for you. To apply, you must provide basic personal and financial information such as your name, address, social security number, and income.

After filling the required information, you submit the application and wait. If you get confirmation that you have been approved for a balance transfer card, you can proceed with the transfer.

transfer credit card balance

Keep in mind that applying for a balance transfer card can result in a hard inquiry on your credit reports, which temporarily lowers your credit score a bit. However, it can increase your available credit and decrease your credit utilization, which can improve your credit score. In general, balance transfers can have little impact on your credit.

Request a balance transfer

Here are 2 ways to request a balance transfer:

Phone: To request a balance transfer, contact your issuer. You provide them with the account information and the amount in which you transfer the balance.

Online: You can request a balance transfer by logging into your account and using the issuer's online portal. Be prepared to provide information about the debt you want to transfer, such as the issuer's name, amount owed, and account information.

Transfer the balance to the new credit card

After completing the previous three steps, your next step is to transfer your current balance to the new card.

This process is also easy. You need to provide basic information about the credit card you want to transfer the balance to, including card numbers and the amount you want to transfer to your new card.

Wait for the transfer to go through

Balance transfers may take up to two weeks or more to be approved and completed. It's important to continue making payments on your old cards until your balance is fully transferred to your new 0% APR credit card. If you don't, you risk accruing new interest charges and fees on your old credit cards due to missed payments.

Once your balance transfer is complete, you may not receive a notification, so check with your old credit card issuers to make sure the accounts show a $0 balance. You can stop making payments once you confirm a $0 balance.

Pay off your credit card balance

After your balance transfer is complete, you can see the amount transferred to the new credit card. Now you start paying off your credit card balance according to the term on the new credit card. However, if you can't transfer all of your balance to the new card, remember to make at least the minimum payment on your old card.

During the introductory period, plan to pay off your balance — or at least most of it — when your APR is lowest. By doing this, you can save money on interest, pay off debt faster, and take advantage of balance transfers.

transfer credit card balance

After you pay off your current debt, you should create a plan or budget to avoid incurring more credit card debt in the future.

balance transfers hurt your credit?

You may see a positive impact on your credit score if you transfer your balance to a single new card and take action to reduce your debt balances. But if you constantly open new credit cards and transfer balances, your credit score can actually drop.

Is it possible to transfer one credit card balance to another?

Generally, you can log onto your account and request a balance transfer through the issuer's online portal. Be prepared to provide information about the debt you're looking to move, including the issuer name, the amount of debt and the account information.

Is it worth it to transfer a balance?

A balance transfer generally isn't worth the cost or hassle if you can pay off your balance in three months or less. That's because balance transfers typically take at least one billing cycle to go through, and most credit cards charge balance transfer fees of 3% to 5% for moving debt.

What are the negatives of a balance transfer?

You'll usually pay a balance-transfer fee. ...
Your APR could skyrocket after the promo period. ...
New purchases often do not enjoy the promo rate. ...
You may not be able to transfer all of your debt to one card. ...
You need good credit to get a balance-transfer card. ...
Timing is important. ...
On-time payments are key.

What is considered too many credit cards?

There is no specific number of credit cards considered right for all consumers. Everyone's credit history is different. Lenders tolerate different levels of risk, and different credit scoring formulas have different criteria. What one lender views as too many credit cards may not be the same as another.

How many times can you do a balance transfer on a credit card?

If you have credit card debt on multiple cards, it can be a good idea to consolidate it to one balance transfer card to save money on interest charges and manage your debt better. You can generally transfer as many balances as you want to a single 0% APR card, but you'll need to meet certain requirements.

What is a balance transfer fee?

A balance transfer fee is the amount of money a lender charges a borrower to transfer existing debt from another institution. This fee is commonly charged by credit card companies when cardholders move balances from one card to another. The fee is usually a percentage of the total amount transferred by the debtor.

How much can you do a balance transfer for?

What is the maximum balance transfer amount? Depending on the credit card, you could be able to transfer a maximum of 70% to 100% of your approved credit limit. So in some cases, you may not be able to transfer all of your debt even if it's equal to, or more than, your approved credit limit.

What's the advantage of credit card balance transfer?

Credit card balance transfers are typically used by consumers who want to move the amount they owe to a credit card with a significantly lower promotional interest rate and better benefits, such as a rewards program to earn cash back or points for everyday spending.

How long does a balance transfer take?

about five to seven days

A balance transfer occurs when you move a balance from one credit card to another. This process typically takes about five to seven days. But word of warning: Some credit card issuers can take 14 or even 21 days to complete a balance transfer.

Does a balance transfer increase credit limit?

No, balance transfers do not increase your credit limit. You cannot transfer a balance that exceeds your account's credit limit, and issuers will either reject such a balance transfer request or accept only a partial transfer.

Can I have 2 balance transfer cards?

Yes, is the answer to this question. You can have more than one balance transfer credit card at the same time. However, you will most likely, have to have your balance transfer credit cards from different companies.

Can I balance transfer more than I owe?

Credit card balance transfers are often limited to an amount equal to the account's credit limit. You typically can't transfer a balance greater than your credit limit—and you won't know your credit limit until you're approved for the account.

What does a balance transfer do?

The goal of a balance transfer is to save money on interest while you pay off credit card debt. You can move a credit card balance to a new card, but typically, you're not allowed to transfer a balance from one card to another that's issued by the same company or any of its affiliates.

What credit score do you need for balance transfer?

670 or higher

Issuers of balance transfer cards typically require a good or excellent credit score to qualify, which is 670 or higher on the 850-point FICO credit scoring scale.

Can I use my Capital One card to pay off another credit card?

First, you should know that at Capital One, you can't directly pay your credit card with another credit card. That means when you go to make a credit card payment on your Capital One account, you won't be able to enter another credit card number to complete the payment.

Does Capital One allow balance transfers?

Capital One allows balance transfers on both new or existing cards. Keep in mind the total amount of the transfer (including fees) cannot exceed the credit limit of the card.

Will I save money on a balance transfer?

A balance transfer can help you save money by moving high-interest debt on one credit card to a card with a lower interest rate or an introductory 0% APR offer. When you shift a balance to another card, you may have to pay a balance transfer fee, which is typically 3% to 5% of the amount being transferred.

Is a 3% balance transfer fee good?

Is a balance transfer fee worth it? If you have a significant amount of credit card debt, the 3% balance transfer fee (or sometimes even a 5% fee) is absolutely worth paying when transferring your balance to a card that has a 0% intro APR offer, but only if you still need time to pay off a balance.

How can you avoid a balance fee?

The only way to avoid balance transfer fees is to find a card that waives the fee entirely. It's possible that you'll come across a credit card with an intro balance transfer fee offer. In that case, the issuer will waive the fee on transfers completed within a certain timeframe.

Do you get charged for transferring money from a credit card?

Many credit card providers offer money transfer cards with a 0% interest-free period. This means you'll be given a set period when you won't be charged interest on your repayments. But you will be charged a transfer fee. Generally, the longer the interest-free period, the higher the transfer fee is likely to be.

Does a balance transfer have to be the whole amount?

A balance transfer does count as a payment. This means that as in the example above, there is no reason why you should not make a partial balance transfer. Any balance transfer to a 0% card, even if you just transfer part of a credit card balance, is likely to reduce the amount you pay in interest.

What is a good average age of credit accounts?

The more years you can put between you and your first (successful) credit card application, the more your score will benefit. As you add new credit, however, your average will drop. While there is no golden number to aim for, getting your average age of credit to between six and 10 years is probably a good goal.

What is the best amount of credit cards to have?

It's generally recommended that you have two to three credit card accounts at a time, in addition to other types of credit. Remember that your total available credit and your debt to credit ratio can impact your credit scores. If you have more than three credit cards, it may be hard to keep track of monthly payments.

What is a good number of credit cards to have?

Credit bureaus suggest that five or more accounts — which can be a mix of cards and loans — is a reasonable number to build toward over time. Having very few accounts can make it hard for scoring models to render a score for you.