Is 0 on balance transfers a good deal? - Balance Transfers Questions


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Credit Card Applications » Questions » User Questions » Balance Transfers » Is 0 on balance transfers a good deal?

Is 0 on balance transfers a good deal?

Answered on | Updated on March 7th, 2011
The content is accurate at the time of publication and is subject to change.

Balance transfer credit cards almost went extinct during the recession when a lot of card issuers closed down the accounts of customers with balance transfer offers. A balance transfer card allows a customer to pay off an outstanding balance on another credit card and move the balance to the new card. There are incentives offered for instigating such a move, and this is how credit card issuers attract customers of other credit cards to use their cards instead. One of the biggest attractions of a balance transfer credit card is the 0% interest rate that is offered during the introductory period. These offers are being given out once again by a lot of card issuers these days.

It is not possible to directly answer whether a balance transfer is a good deal or not. It changes from card to card based on the terms and regulations. That is why customers should be especially keen to read the fine print on the balance transfer cards to find out what exactly is on offer. The introductory period could be between 6 months to 18 months or sometimes even more. It depends on the credit score of the individual, which is why not all cardholders get the same introductory period. That also means varying benefits and hence customers are better off making their own calculations.

The longer the introductory period, the greater the benefit of the credit card. There are other parameters that make the card more or less valuable as well. For example, the balance transfer credit card is really useful if the 0% interest rate is also applicable for purchases made on the cards and not just for the balance transferred. That would effectively mean there is no interest on the credit card during the initial period allowing customers to save substantial amounts. The balance transfer credit card also offers a good deal only if the fee charged is not exorbitant. Applicants therefore need to check 2 kinds of fees on the balance transfer card which are more important than the rest of them. The annual fees which shouldn’t be charged at all preferably in the first year and the balance transfer fee, which shouldn’t be more than 3 – 4% of the balance transferred, can tilt the balance on either side. Also applicants should take a look at the APR after the introductory period to decide if it is a good deal indeed.

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.
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Intro APR on Balance Transfer: 0% 12 months on Balance Transfers

Ongoing APR on Balance Transfer: 15.74% - 25.74% (Variable)

Balance Transfer Fee: 3% of each balance transfer; $5 minimum.

Excellent, Good Credit

Intro APR on Balance Transfer: 0% (first 12 billing cycles following each balance transfer that posts to your account within 45 days of account opening)

Ongoing APR on Balance Transfer: 18.24%, 22.24% or 25.24% variable based on your creditworthiness

Balance Transfer Fee: Either $5 or 3% of the amount of each transfer, whichever is greater

Good/Excellent Credit
See Rates & Fees

Intro APR on Balance Transfer: 0% Intro APR for 12 months

Ongoing APR on Balance Transfer: Variable APR of 15.24%, 19.24% or 25.24%

Balance Transfer Fee: Either $10 or 4%, whichever is greater, will apply on each balance transfer and credit card check

Good, Excellent Credit
See Rates & Fees

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