The content is accurate at the time of publication and is subject to change.

Credit card balance transfers can be very advantageous when it comes to paying off credit card balances. When you are a frequent credit card user and shopper, you may not be able to make the best out of your balance transfer rate. You need to be concentrated on reducing your balance before you can see the effect of the low interest rate.

How low can a Balance Transfer interest rate be?

In understanding interest rates for credit card balance transfers, there are types that you need to know. First, we have the introductory or the teaser rate and second, the normal or default interest rate. The default interest rate is the normal rate applied to a credit card account. An introductory rate is given to attract customers and usually this is given for credit card transfers. The lowest is 1%. Sometimes, banks also give 0% or and interest free introductory offer.

Is the interest rate given to me for a balance transfer guaranteed?

The rate that you will be given on your credit card balance transfer is not fixed. It is subject to change. Usually, the introductory interest rate is provided for a given period of time. You will only be given at least six months of that rate for you to take advantage of it and afterwards you will be charged the regular interest rate. So, you have to be careful in choosing who you do credit card balance transfers with. Familiarize yourself with their terms and conditions when it comes to rates.

The introductory interest rate offer is automatic when I do a balance transfer, isn`t it?

Most people think that if they were offered the lowest rate, it will be the rate when they apply for a balance transfer. That is not the case. With every application, institutions need to evaluate your creditworthiness so they review your credit history. If you have a low credit score, it is possible that you will be given a higher rate than that of a person who has a perfect credit history. Before you apply for a balance transfer, ask the banks that you are prospecting about their evaluation on credit history and its connection to getting that low introductory interest rate.

Will the introductory interest rate applied to all transactions on my card?

It will depend on your chosen bank whether this interest rate will be applied to all the transactions made on your card. There are times that the low introductory interest rate is only applied to the balance that you transferred and not on the succeeding purchases made on the card. It would be helpful if you know what interest rate will be charged for what and how your payments will be applied to them. If you are able to understand the processes then you will definitely make the most out of your credit card balance transfer.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.