These days, we hear so much about balance transfer credit cards. In fact, many consumers are choosing new credit cards based primarily on whether or not it allows balance transfers and whether they’ll be able to take advantage of an intro APR when they move balances from higher interest credit cards. To say there are money-saving opportunities is an understatement. All balance transfer credit card offers are not created equally, though. How do you choose?
First Things First
Be sure you understand all of the dynamics of a balance transfer offer. The fine print really matters with these offers.
Just because you receive an offer with an intro APR for a period of time doesn’t mean that lower (or zero) interest rate will apply to balance transfers. Sometimes, it might even be that you pay a higher interest rate for transfers, so be sure you’re applying for a credit card that offers this as a perk. And speaking of higher interest rates, you’ll want to be sure you know what the default rate is. A late or missed payment or going over your credit can result in a loss of your intro rate and it can even trigger the maximum legal percent a card company can charge you.
Tip: Also, as you’re doing your comparison shopping, pay attention to how long the lower APR will be in force. This is another reason why the terms and conditions are so important.
Naturally, your goal is to move those balances from higher APR cards so that your payments are applied only to the principle. Be sure to take advantage of that window of time. Pay as much as you can each month. The more you pay now, the lower the balance you’ll be paying interest on after the intro period has passed.
Tip: Be sure to check into any initial fees you’ll pay for each balance you transfer. Also, do the math on any annual fees too.
Consider the Hit to Your Credit
Many consumers don’t know this, but a balance transfer can hurt your credit score. It takes a hit anytime you have a card with a balance that’s above 30% of the credit limit. Keep that in mind as you go about moving your balances over. It might only be a temporary hit, but it’s good advice to remain aware of how close you are to that 30% cut-off.
Chase Slate Vertical Card with Blueprint
This credit card offer has several perks, including an intro period with 0% APR for up to fifteen months. After that, your APR can be as low as 11.24% (your credit scores and credit history play a significant role). Other perks include no annual fee and the backing of of the biggest names in the financial sector. You’ll incur a 3% balance transfer fee, though this is in line with other comparable credit card offers.
This is another offer that many consumers are choose. It too offers an intro 0% APR. Transfer your balances with no APR for the first fifteen months. After that, the rate will change, based on your past credit activity. You’ll also enjoy up to 20% cash back bonuses at select retailers when you use your Discover More card to shop online. This credit card also has no annual fee, making it an attractive consideration for many.
Starwood Preferred Guest Credit Card
While this particular co-branded card offer doesn’t not include a 0% APR offer, you can take advantage of transferring your balances with only a 2.9% APR. American Express has team with Starwood hotels to present this offer. Along with easy balance transfers, this is also a favorite credit card for those who travel for work or pleasure.
As always, we remind our readers that these are just a few of the balance transfer options that can help you save big money year round. With more banks and companies competing for your business, it’s worth the extra time to research each offer before you make your decision. Those extra few minutes invested now can affect you and your budget for many years.